The Influence Of Local Government Behavior To Industrial Transfer

Industrial transfer is an economic phenomenon which is ubiquitous under themarket economy. It is also an impersonal demand and necessity trend that can adjustthe industrial structure and integrate regional economic. How to promote theindustrial transfer is realistically significant to the competitive ability cultivation andthe continuous industrial development between the Eastern and Midwest China in thenext years. However, a large-scale industrial transfer between the Eastern andMidwest China doesn’t implement. One of the main reasons to the inefficiency inindustrial transfer is the imperfection of market system and the misbehavior ofgo’vernments behaviors in industrial transfer.This paper analyzes the status of our countr’ys industrial development and thedifferences environment between the Eastern and Midwestern first, found thatMidwestern are lagging behind in terms of the total economy，the pace of economicdevelopment, the importance of economics to Eastern. Although the situation hasimproved in recent years, there is still a significant difference between the Easternand Midwestern. Because of this difference，there are big differences between thebehaviors of the local governments. The Midwestern local governments are laggingbehind in terms of ifnancial capacity, the degree of diversification of property rights,the capacity of basic services, the openness and the capability of regional innovation.Based on the current situation, this paper discussed the influence of the behavior oflocal governments with industrial transfer through the game modes betweengovernments, the government with transfer business. Local governments can reducefactor costs and transaction costs in enterprise migration to facilitate the transfer ofindustries. But these behavioral effects of the local governments are uncertain, localgovernments need to develop effective measures to realize the goal of economicdevelopment according to the different stage of industrial development.In view of this, this paper based on2000-2010panel data of31provinces inChina, establishing fixed effects model to analysis the influential effect ofgovernment behaviors on industrial transfer. The results show that the efforts ofgovernments to enhance financial support, the degree of diversification of propertyrights, the sophistication of infrastructure, and the support of regional innovation canimprove the attractiveness of industrial transfer. However, the effectiveness of different areas’ local government behavior is different. Eastern governments canbrought a significant effect in terms of ifnancial support, the degree of diversificationof property rights, and the support of regional innovation. And Midwesterngovernments can brought a significant effect in terms of financial support, thesophistication of infrastructure and the degree of diversification of property rights. Tothis end，this paper summarized the results, and put forward some policy suggestions.