The Relationship between the Local Public Budget Ability of Stabilization and Adjustment and Debt Risk:From the Perspective of Overall Planning Based on the"Four Parts of Government Budget"
The public budget stabilization adjustment mechanism is a cross-year budget balance mechanism established in China in 2007.This paper uses China's mainland provincial panel data from 2015 to 2021 and empirically tests the impact of the local public budget's ability to stabilize and adjustment on debt risk based on the characteristics of China's current fiscal budget management system.The research results show that the local public budget ability of stabilization and adjustment can significantly inhibit debt risk,which enhances fiscal resilience and alleviates fiscal pressure.Moreover,in areas with low levels of industrial structure rationalization and digitalization,the inhibitory effect of the local public budget's ability to stabilize and adjust to debt risk is more obvious.Further analysis shows that the local public budget's ability to stabilize and adjust can also inhibit the debt ratio and increase the space retention rate of the local government debt limit.This conclusion still holds for the general debt ratio and the general debt limit space retention rate.It is suggested to optimize the supplementary mechanism of the local public budget ability of stabilization and adjustment fund,and build a correlation mechanism between the use of the budget stabilization adjustment fund and debt risk.Through fiscal and financial synergy,to play the role of the public budget stabilization adjustment mechanism as a"regulator"of medium-term and long-term debt risk fluctuations.
Public budgetAbility of stabilization and adjustmentDebt riskFiscal resilienceFiscal pressure
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