Impact On Economic Growth In Yunnan Province Expenditure

Economic growth has been an important goal of the macroscopic economicpolicy which is pursued by the central and local government. While the fiscalexpenditure as an important part of the government macro-control policies, it plays avery important role in adjusting and promoting the national economical short-termfluctuation and long-term stable growth. The earliest study for the economic growthcould be dated back to the eighteenth Century70’s, and Adam Smith’s economicgrowth theory began with the ideas of virtuous cycle about the interaction of capitalaccumulation and the labor division. Because of a late start, our country had beenaffected by the planned economic system, and it led to the research on fiscal policyand economic growth hysteretic and not further. With our country economic system’sconstant improvement and reform, many scholars’ studies about this field have beenembedded so far, and most of researchers selected the whole country as the researchobjects. So in this paper, on the basis of previous studies, and the research isestablished in Yunnan Province, meanwhile, I hope it can make the contributions tothe economic construction for our province.This paper chooses Yunnan Province as the research object, and the scholarsalmost have been concentrating on national and eastern areas in this field for a longtime, but seldom on the southwest areas. Since the reform and opening up, China’seconomic development has mainly depended on the mid east areas’ economy, but thebackward southwest areas’ economic development has been the national and evenlocal governments concerned question. Through the study I found, fiscal expenditureof the local government does have a certain role in promoting the regional eco nomicgrowth, meanwhile, the study of the fiscal expenditure structure found that ourprovince should be appropriate to reduce agricultural and administrative expenses,and enlarge the subsidies including culture, education science, health and socialsecurity, in order to promote the provincial economic growth. Using theoretical analysis method and the Ramsay Model, it shows that if thegovernment expenditure includes investment, increased government expenditure willlead to the steady-state path change and the output increase. Using the empiricalanalysis method, this paper tests the impact on economic growth theory from the scaleand the structure of the financial expenditure (government expenditure). This researchshows that the scale of government expenditure has played a considerable role inpromoting our province economic growth, at the same time, the government shouldappropriately adjust the construction of agriculture,and reduce administrativeexpenses, and expand culture, science, health and social security subsidies, so that itwill be helpful to our long-term economic growth.