Regional Differences In The Supply Of Public Goods Research

China is currently establishing a public financial system, as the system changes,government secede from many competitive fields,providing fair and effective public goods become one of the main functions of government. Based on this background, study on public finance becomes a key research area in cameralistics. Because of an imbalance in economic development level among the east, middle and western of China, public goods supply is much different. Public facilities and the supply of public services which is necessary for society development, such as transportation, irrigation, basic education, is insufficiency in many backward areas. Shortage of public goods directly affected the people's living standards and quality of life in backward areas. We are now proposing to build a harmonious society so that all members of the society can enjoy the benefits of reform. This requires the government to provide each member a fair starting point so far as basic public goods supply is concerned.Based on the experience in public goods supply abroad, many methods adapted by United States and Germany to resolve public goods supply is worthwhile for us to learn from. According to public goods accommodation policy adapted by Germany and the United States, regional economic disparities is reduced to an acceptable scope, so as to maintain country's stability and social equity, on the other hand, basic conditions for economic development is provide in backward areas, therefore the capacity for self-development is produced in the backward areas. Meanwhile, bottleneck restricting the development of the national economy is eliminated, domestic market is expanded, and country's strong economic growth is maintained for a rather long period. Similar to the United States and Germany, China is a large country whose regional development is imbalances. Due to historical and practical reasons and the differences in economic development lever, public goods supply in western and middle is much laggard than in the east. After the decentralization reforms in 1994, powers of the circumstances by local government keeps increasing, however, financial powers corresponding does not increase correspondingly. Due to the imbalance between financial and circumstances power, financial in backward region are unable to afford the basic public goods supply required for economic development and social equity in local region. Serious regional differences appeared in China's public goods supply. Public goods supply is relatively sufficient, or even overstock in some kinds of public goods in eastern region, while it is relatively insufficient in western region and failed to meet the requirements of economic development. This is contravention to our ongoing policy of balanced development in regional economy.Regional difference in public goods supply also brings much adverse effect on further economy and society development in our country as follows: affect the basic fairness which going against social stability; decreases economic efficiency which increasing transaction costs; impede the flow of factors of production and exchange of goods and limit the expansion of the domestic market and industrial upgrades and transfer; unable to meet the need to enhance the capacity of self-development in backward areas; border is not conducive to national unity and stability.Therefore, we must, in the light of national conditions and strength, in determining the supply of public goods on the basis of reasonable size. supply of public goods made in the reform of the system. So that the government and the complementary functions of the market in the supply of public goods. This requires reform of the supply of public goods, to introduce more market competition; Improving transfer payment system. Financial strengthen the backward areas, and increase the supply of public services in backward areas, The state should increase investment in public goods and backward areas in the central and western regions. vertical transfer at the same time in different parts of the lateral transfer. Supply of public goods through the system, and improve our public service system, and achieve the equalization of basic public services. formed to benefit all the public service system.Certainly, narrowing regional differences in essential public goods supply and achieving a balanced regional economic development is not absolutely, but rather a lengthy and dynamic process. We should keep exploring in practice, utilize advanced experience abroad actively. Only in this way can the aim of constructing more harmonious development be achieved.