Research About Temperate Size Of Local Government Debt In China

When the European debt crisis intensified, has drawn worldwide attention when, China’s local government debt issues are also increasingly evident. As China’s financial system and other reasons led to our local government in order to develop the local economy, public goods to meet local community needs, a lot of debt. The huge size of the debt will result in the risk of local government debt looming, if not timely to control the growing size of the debt, once the risk of expanding the debt crisis will be on China’s financial stability and even our economy to cause significant adverse affected. Therefore, the size of local government debt is to study local government debt risk control and a strong premise. Services will be on the scale of local government debt management and risk aversion has a very big help.Most of our scholars the local debt tend to focus on local debt risk control and prevention, and management of local government debt, etc.,for a separate study of the scale of local government debt is relatively small. Scholars before the existing research results, adding their own unique approach to study the scale of local debt, this paper mainly from the following sections on the size of the debt, the first is the introduction part, this part of the background of this thesis, as well as the elaborate and clarify the research methods and the innovation and inadequacies. Secondly, the analysis of the theory of local debt. Mechanism have a clearer understanding of the theory, the formation of such a huge scale of China’s local debt. Third, a data analysis on the status quo of China’s local debt scale, so that the people have an intuitive feel for the debt situation. The fourth part of the analysis I had the mechanism of the formation of local debt, explore the root causes of the causes of our debt, and use empirical quantitative analysis, to provide a more solid evidence for the thesis. Finally, the optimum size of the debt of local governments in China are discussed. Combined with China’s national conditions, the optimum size of the debt model to explore the Chinese characteristics.