An Analysis Of Local Governments Inter-district Imitation Effect And Fiscal Policy Convergence

This paper studies the inter-district learning and fiscal policy convergence. Local government officials learn into rational and irrational to imitate. In order to measure the effects of learning itself, a tool variable was choosed. Using the game theory, a theory was constructed to explained the policy immitation.This paper has established the local officials to interregional learning effects and fiscal policy convergence theory framework. the copycat effect under the network environment officials and copycat effect eventually form the economic effects of fiscal policy convergence process were analyzed. On the basis of constructing econometric model, the introduction of official foreign exchange as a proxy variable, the similarity coefficient of fiscal policy, local officials to learn network descriptive statistics analysis.The official exchange matrix as the independent variable were analysed to the overall network structure and the individual network location for the effect of fiscal revenue and fiscal expenditure. There are 320 Chinese regional experience administrative units as samples analysis result from 2005 to 2012 and examine the effect of local government officials to study the impact on the urban fiscal policy.Firstly, the results show that local government officials of imitation is easy to appear "herding effect",under the precondition of information asymmetry. Secondly, the local fiscal policy convergence. Thirdly, the convergence is mainly embodied in the cities are formed through the spillover effects of fiscal policy, namely the indirect effect.Forthly, the individual network location have an impact on local government fiscal policy convergence. Lastly, China’s local government learning network is different from the geographical spatial econometric model, it has stronger regional agglomeration effect even between long distance cities. Empirical model strongly illustrated the prefecture-level governments has of fiscal policy convergence effect. "Herding effect" makes officials ignore the local comparative advantages, which is bad for the coordinated development of regional economy.