Fiscal Decentralization,Local Fiscal Deficit and Land Finance:A Case of J Province

Abstract

The current fiscal decentralization system worsens the local government fiscal deficit.Under the condition of the constrained autonomy in income,local government can only rely on the land finance to alleviate the fiscal deficit.The current performance appraisal system and the imperfect budget system result in land finance.In this paper,we take J province as an example,which is the less-developed areas in central provinces,and verify that the local fiscal deficit plays positive impact on the land finance.Finally,we advise the government to cure the problem of land financial by improving the existing system of fiscal decentralization,giving local governments more financial power,improving the budget management system,enhancing the normalization of the budget,and building a performance evaluation mechanism of people-oriented and promoting the scientific development.