The Transfer Payments Effect on Non-Economic Public Goods Supply under the Fiscal Decentralization

• 1、School of Economics and Trade, Hunan University, changsha 410006

Abstract：In the critical period of building a well-off society in an all-round way, it is still of great significance to study the influence of fiscal decentralization and transfer payment on the supply of non-economic public goods in the background of our country\'s special financial and economic system. A theoretical model is established to get the response function of local non-economic expenditure to fiscal decentralization and transfer payment, and theoretical assumptions are made. Through the empirical test of the theoretical hypothesis through the provincial panel data, it is found that, in general, China\'s fiscal decentralization and transfer payment are beneficial to the supply of non-economic public goods. In the regions of China, there is a positive correlation between financial decentralization, transfer payment and non-economic public goods supply in the eastern part of China. There is a negative correlation between fiscal decentralization, transfer payment and non-economic public goods supply in the underdeveloped areas of Western China. In order to improve the supply of non-economic public goods, the problem of improving the supply of non-economic public goods can be better improved by promoting the reform of the financial system, reversing the incentive orientation of the local government and the bias of the fiscal expenditure, actively perfecting the transfer payment system, giving full play to the incentive effect of the transfer payment, and vigorously developing the economy and promoting the urbanization reasonably.

Keywords： Finance Fiscal Decentralization Transfer Payment the Supply of Non-Economic Public Goods