The Studies On Fiscal Decentralization And The Expenditure Behavior Of Local Governments In China

Since the last century,fiscal decentralization has become quite common in the world, most developed countries has implemented fiscal decentralization.Among the 75 countries, which are in economic transition with more than 5 million population,84%of the developing countries are committed to the devolution of certain powers to local governments.With the gradual deepening of reform and opening-up policy,fiscal decentralization is also well-known and accepted by more and more people.Along with China's fiscal decentralization,the expenditure behavior of local governments has changed.The influence of fiscal decentralization upon the expenditure behavior of local governments is mainly through decentralization on fiscal expenditure structure and scale of local governments.In this paper,we have studied the impact of fiscal decentralization on local governments' expenditure behavior by analyzing the effects of decentralization upon fiscal expenditure structure and scale of local governments with nationwide provincial panel data from 1994 to 2006.Then,we put forward some reasonable measures.