The Research On The Investment Efficiency Of Local Government Infrastructure

Since the global Economical crisis in2008, the governments have turned toinfrastructure investment for the purpose of economical recovery. At present, theinfrastructure investment has become the thruster of economical recovery. At present,the infrastructure investment has become the thruster of economical recovery. In orderto promote the sustainable, orderly and effective development of economy, ourgovernment adopted the economical stimulus package including thefour-thousand-billion stimuli. The questions, such as how do investment efficiencywork on economic development, how high is investment efficiency, how to measureand forecast the investment, need further study. So it is important to research on theinvestment efficiency of local government infrastructure.This paper discusses theories on the investment efficiency of local governmentinfrastructure and offers an empiricist research on the investment efficiency ofChina’s local government infrastructure based on the data of investment efficiency oflocal government infrastructure in30provinces from2001-2011. First of all, therunning inventory method is used to measure the capital stock of local governmentinfrastructure from2001to2011. Then, based on the measurement, the three-phaseEDA model is adopted to inspect the relative validity of local governmentinfrastructure from a static perspective. The results show the differences betweeneastern, middle and western provinces in terms of infrastructure investment efficiency.The investment scale is the main factor to restrict infrastructure investment efficiencyof middle and western provinces. While to eastern provinces, the capital managementis the main factor. Later, the Malmquist index is used to inspect the changes in localgovernment infrastructure investment efficiency from a dynamic perspective. Theresults show that, from2001to2011, there is a fluctuation in local governmentinfrastructure investment efficiency. The horizontal analysis shows that there is adecline in investment efficiency of local government infrastructure both in westernand middle provinces.This paper offers some innovations and improvements. First, strictly distinguishlocal government investment, central government investment and non-governmentinvestment base on the sources of money. This recuperates the past analysis. Second,the subsection trade date of local government infrastructure is used as input index. The date that directly inflects the local government infrastructure efficiency is used asoutput index. Third, the research model of local government infrastructure investmentefficiency combing static and dynamic approaches is established.