Research On The Influence Mechanism Of Local Government Debt Expansion On Midwest Areas Under The Pressure Of Environmental Assessment By Officials

The problem of local government debt has always been an urgent problem to be solved in China’s financial system.In recent years,the scale of local government debt has been continuously expanding,and the accumulated debt risks have been sharply deepened,which has negative impacts and adverse expectations on China’s economic activities and regional sustainable development.China’s local government debt expansion has a unique historical background.After the tax-sharing system,the inequality of local financial power and administrative power is considered to be an important factor of local debt expansion.However,only from the perspective of financial system can’t fully explain the enthusiasm of local government for debt investment,and it is necessary to further investigate the incentive effect of cadre assessment system.Given that local governments have the ability to influence economic activities,what role local governments play depends on the official governance system in China.Therefore,in order to resolve the financial risks caused by the expansion of local debt,the central government not only introduced a series of policies to control local public debt,but also further optimized the promotion and assessment mechanism of local officials,weakening the GDP competition and expanding the weight of environmental assessment.As we all know,when the social economy has not developed to a certain stage,economic growth and the environment are like two sides of a coin,and they cannot have both sides.The reform of the official assessment mechanism that emphasizes environmental assessment is expected to change the current unsustainable debt-dependent economic growth mode by changing the official assessment standards,and optimize the economic development structure of our country while defusing the debt risks of local governments.Then,it is of great significance for China to prevent major risks and transform its economic structure to analyze the factors that affect the effectiveness of the reform of the official assessment mechanism and explore ways to alleviate the trend of local government debt expansion.Therefore,based on the perspective of the reform of the official assessment mechanism,this paper makes theoretical analysis and realistic data description on the motivation of local officials’ borrowing behavior and the mechanism of local government’s debt expansion,and makes an empirical test on the basis and influencing factors of local officials’ borrowing in different areas.This paper finds that the weakening of economic growth incentives is not enough to make debt growth return to rationality,because it is also influenced by the land supply system,and this paper provides theoretical support for clarifying this influencing mechanism.the following conclusions are drawn: the reform of official assessment mechanism that emphasizes environmental protection has different results in different endowment areas.Instead,officials in the midwest areas who are less constrained by environmental assessment take this opportunity to choose a debt-dependent economic growth model that is not conducive to the improvement of environmental quality,resulting in the continuous expansion of local debt.The inclination of construction land index provides element support and institutional space for local officials’ land financing behavior in the midwest areas,thus strengthening the trend of debt expansion,aggravating the accumulation of debt risks in the midwest areas and inadvertently bringing heavy environmental costs.Therefore,at present,to truly solve the problem of local government debt expansion,we should not only improve the design of official appraisal mechanism,but also coordinate with other systems,such as the optimization of China’s land supply system.If we only hope to reverse the current unsustainable economic development mode by providing the underdeveloped areas with the inclined supply of factors,rather than through more fundamental institutional changes,it is easy to become a pipe dream to truly realize the beautiful vision of narrowing the development gap between regions.