Does Fiscal Policy Contribute to TFP Growth?——An Empirical Analysis Based on Provincial Panel Data from 1999 to 2015
LIANG Wei-jian1, ZHANG Le2
1.College of Economics and Management, South China Agricultural University, Guangzhou 510642, China; 2.Strategic Planning Department of Guangzhou Rural Commercial Bank, Guangzhou 510623, China
Abstract：
Based on the provincial panel data from 1999 to 2015, the paper analyzes direct and indirect effects that fiscal policy has on TFP. The main conclusions are as follows: During the sample period, financial expenditure on science and technology is conducive to TFP growth, whereas the effects of direct investment, social security expenditure and social consumption expenditure on TFP are not notable. Corporate taxes and personal taxes hinders TFP growth. The direct effect of financial expenditure in science and technology on TFP comes into play in that expenditure on education and technology can improve human capital, support overall economic R & D investment, and thus promote innovation.The indirect effect is that financial expenditure in science and technology can accelerate the spillover of foreign knowledge and technology by means of improving human capital.The direct effect of corporate tax on TFP works through the fact that it dampens the enthusiasm of enterprise innovation, while its indirect effect is that corporate tax hinders the inflow of FDI, which is not helpful for domestic enterprises to learn and absorb foreign knowledge and technology. Therefore, reform should precede direct policy support in order to bring the positive effect of fiscal policy on TFP to full play.
LIANG Wei-jian, ZHANG Le.Does Fiscal Policy Contribute to TFP Growth?——An Empirical Analysis Based on Provincial Panel Data from 1999 to 2015[J] Economic Survey, 2017,V34(6): 159-164
2017 
