The Changes Of Central-local Fiscal Relations In China Since Reform And Opening-up

The central-local fiscal relations are the core content of the fiscal system.And the fiscal system is the carrier of the relations.Since reform and opening up,along with changes of financial system,the central-local fiscal relations have gone through three periods of fiscal responsibility,fiscal tax sharing and modern finance.In the first period,grading contracting replaced unified revenue and expenditure,and the central and local governments formed a financial relationship characterized by decentralization.It improved local governments’ enthusiasm of financial management and stimulated the development of local economy.However,the proportion of central fiscal revenue in the country’s total fiscal revenue has been declining year by year.In 1994,for reversing this situation,a unified tax-sharing system was implemented across the country,which laid the foundation for the long-term and stable operation of the central-local fiscal relations.After the18 th National Congress of the CPC,finance was embedded into the national governance system and a new goal of establishing a modern fiscal system was proposed.The central-local fiscal relations entered the modern fiscal period.In this process,why the central-local fiscal relations changes and how the agenda is set are the key issues to understand the contemporary central-local fiscal relations,and it is also the main content of this paper.So,the author firstly defines the central-local fiscal relations,and distinguishes it from similar concepts such as fiscal system and inter-governmental fiscal relations.Secondly,taking the changes of the financial system as clues,this paper summarizes the policy change paths and characteristics of the central-local fiscal relations in each period.On this basis,this paper introduces the multiple streams theory to find out the problem flow,policy flow and political flow of each period and to explain how the policy window is triggered and how agenda is set,through a large number of documents,policies,historical records and other texts.This paper finds that due to the complexity and professionalism of the central-local fiscal relations,most of the alternatives were concentrated within the government and the think tank team composed of experts and scholars.In the problem stream,the changes of fiscal indicators,especially the changes of central government are the main factors driving the establishment of the agenda.The change of government and fiscal concept in the political stream are the core forces that trigger the policy window,and often bring about major policy changes.In addition,spillover events are also an important boosting force for triggering the policy window.From overall view,the change of the central-local fiscal relations shows a reform trend of gradually transitioning from the revenue side to the expenditure side.In the future,political flow triggering the policy window will become commoner in the reform process.Accelerating the construction of a legal system for fiscal relations,further clarifying the division of fiscal office authority and expenditure responsibilities,will be the focus and direction of the reform of the central-local fiscal relations.