Study on the Impact of Soft Budget Constraints on Regional Economic Growth and Its Threshold Effect
China has introduced a series of proactive fiscal measures amidst increasingly weak internal and external demand and large-scale local debt,which forced the government to increase the size of its debt.This study empirically examines the impact of local government soft budget constraints on economic growth across China and its eastern,middle and western regions,using the benchmark regression model and the threshold effect model.It is found that local government soft budget constraints significantly impede regional economic growth,and there is a significant threshold effect between the two.Heterogeneity analysis shows that the negative effect of local government soft budget constraints on economic growth is affected by differences across regions.Therefore,local governments should take measures to stabilize regional economic growth by optimizing the transfer payment system,promoting the market-oriented transformation of financing platforms,improving the over-indebtedness constraint mechanism,changing the concept of officials ' performance appraisal,and formulating differentiated precautionary policies according to local conditions.
local government debtsoft budget constraintseconomic growththreshold effectsheterogeneity
国家科技期刊平台
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