Analysis On The Impact Of Local Government Debt On Regional Industrial Structure In China

At present,our country is in the critical stage of high-quality economic transformation and development.The government is shouldering the key tasks of transforming the growth driver,transforming the development pattern and optimizing the economic structure.High-quality economic growth requires efficient allocation of resources.Government investment,as one of the means of macro-control,has always played a pivotal role,while government debt is an important source of government investment funds.Especially after the implementation of the new Budget Law in 2015,bond issuance has become a new way of financing for local governments.This puts forward higher requirements for properly controlling the scale of local government debt and improving the efficiency of using government debt funds.With the outbreak of COVID-19 in 2020,the total new local government debt in 2021 soared from 4.36 trillion yuan and 4.55 trillion yuan in the previous two years to 7.49 trillion yuan.This phenomenon is easily reminiscent of the sharp rise in the growth rate of local government debt in 1998 and 2009 after the Asian financial crisis and the world economic crisis.Different from the previous two cases,the current stage is under the background of the "new normal" of the economy.In addition to helping to maintain regional economic growth,local government borrowing should also promote the optimization and upgrading of the industrial structure and economic structure.This paper attempts to study the impact of local government debt on regional industrial structure through theoretical analysis,current situation comparative analysis and other methods,and the use of spatial econometric model,hoping to supplement the relevant research on local government debt and provide reference for relevant policy formulation.First of all,this paper collates scholars’ relevant research literature in the fields of local government debt and regional industrial structure,expounds the macro and micro economic effects of local government debt,summarizes the research results of other scholars on the factors affecting industrial structure,and summarizes the economic benefits brought by the optimization of industrial structure.Considering the possibility of spatial spillover from the change of regional industrial structure,The study on the spatial effect of industrial structure is also reviewed.Secondly,it reviews the research theories related to local government debt and regional industrial structure,and discusses the relationship between the two and the influencing mechanism.Through the mechanism analysis,it is found that local government debt has different effects on the industrial structure of the region and the surrounding region,and there are positive and negative impacts.Then,this paper analyzes the current situation of local government debt and regional industrial structure in various provinces,and compares their development and change trajectories to find the relevance of statistical data.Finally,using the spatial Dubin econometric model,this paper empirically analyzes the influence of local government debt on regional industrial structure,and further analyzes the spatial effect,which not only clarifies the influence of local government debt on regional industrial structure,but also finds out its effect on neighboring regions.Combining theory,comparison and empirical analysis,the following conclusions are drawn:First,the balance of local government debt in all provinces shows a general law of increasing year by year,and there is a big gap between the balance of government debt in the eastern,central and western regions.Second,the overall level of the rationalization of the industrial structure and the rationalization of the industrial structure is continuously improving in all provinces.And most provinces’ debt growth rate is equivalent or not very different from that of the rationalization of the industrial structure and the level of the rationalization of the industrial structure in the whole country,but some provinces also have the mismatch phenomenon.Thirdly,by calculating the Moran index,it is found that the balance of local government debt has an obvious spatial correlation with the rationalization and refinement of regional industrial structure.The spatial Durbin model regression results show that the influence of local government debt balance on the rationalization and refinement of industrial structure presents an inverted "U" shape relationship.The increase of government debt scalewithin a certain range will improve the rationalization and refinement of industrial structure,but the debt scale beyond a certain value will hinder the upgrading of industrial structure.Fourthly,the effect decomposition analysis of spatial Dubin model shows that there is a positive U-shaped relationship between local government debt and the rationalization and enhancement of industrial structure in neighboring regions.When government debt promotes the optimization of industrial structure in the region,it will inhibit the optimization of industrial structure in neighboring regions.To a certain extent,factors such as technology,manpower and capital will overflow into neighboring areas and turn into a positive effect to promote the optimization of industrial structure in neighboring areas.