Heterogeneous Competition among Local Governments: Analysis of Irrational Rivalry

Abstract

The decentralization of finance and politics enables local governments to deal with native affairs such as development mode and other public affairs.In the meantime,the evaluation on local governments' performance emphasizes on economic development,GDP growth,and employment rate.This system brings about a fierce irrational competition among local governments.This paper deals with the problem of how to bring the irrational competition back to a healthy one,and the effective way,the use of encouragement and restriction properly,is suggested.