Local Government Competition, Capital Flow and Its Spatial Allocation Efficiency
ZHONG Jun-wei1, WAN Dao-xia2
1.School of Public Finance and Taxation, Henan University of Economics and Law, Zhengzhou 450046, China; 2.Institute of Finance and Economics,Shanghai University of Finance and Economics,Shanghai 200434,China
Abstract：
Using spatial dynamic panel model and taking prefecture data in China from 2000 to 2013 as samples, this article analyzes the effect of local government tax competition and the fiscal expenditure competition on the capital mobility and the allocation efficiency. The results indicate that tax competition among local governments promotes the regional capital allocation efficiency, which is related to the local government fiscal expenditure structure and the spatial mismatch of public finance in China. Capital flow is conducive to the improvement of capital allocation efficiency, and shows synergistic effect on capital spatial allocation efficiency together with tax competition among local governments. China’s inter-regional capital allocation efficiency shows spatial convergence while capital flow shows characteristics of multi-center dynamic evolution.
2018 
