Regional Comprehensive Financial Ability And The Ability Of Public Goods Supply In Our Country Variance Analysis

Under the environment of social transformation, China’s local governance faced with the daunting task of reform. On one hand, local government faced with the task of maintaining sustainable growth of fiscal revenues, extra-budgetary revenue like land-transferring fees takes up a high proportion in the total fiscal revenue, and the revenue raising mode in the less developed areas is far from consistent with the standardization and the rule of law, local governments lack the power to tax and issue bonds, and the central and local fiscal system need to be reformed. On the other hand, under the impact of local fiscal capacity and government official performance evaluation system, in the field of supply of public goods, in addition to productive infrastructure such as roads, transportation, which generally maintains high level, non-productive public goods like culture and education, health care, rural water, electricity and sanitation, and urban and rural social security always not meet people’s need, and the differences between regions are great.In order to understand the status of potential fiscal capacity and the capacity of public goods supply of China’s provinces, autonomous regions and directly administered municipalities, this article uses the method of factor analysis to calculate of the size of the two indicators of all the31provinces, autonomous regions and municipalities, and a further research will be on the degree of match of the two indicators, that is, the level of public goods supply per unit of fiscal revenue, then there will be a transverse comparative analysis, and a discussion on reasons and suggestions.This paper studies in a theoretical and empirical way, the text is divided into six chapters, each chapter mainly reads as follows:Chapter1is the introduction, which introduces the background and origin of the problem, the main research methods, the key concepts involved and the main structure, as well as the paper’s innovative points and inadequate. Chapter2is a review of literature, by carefully sorting out the relevant research results at home and abroad, this paper finds an appropriate analytical method to construct a theoretical model. Chapter3is the theoretical analysis, looking back to the history and current status of fiscal decentralization theory and the theory of public goods, this article does the theoretical derivation. Chapter4is to evaluate the system and model. Chapter5is the analysis of empirical results, it contains three sections:the analysis of the fiscal capacity index of China’s31regions, the analysis of the capacity index of public goods supply, and the analysis of the degree of match of the two indices. Then combined with the quantitative results, the article discusses the similarities and differences of various regions. Chapter6gives some policy recommendations. Including the adjustment of industrial structure, strengthen the non-productive infrastructure, and perform the fiscal system and government official appraisal system reform.