Impacts of dual decentralization on green total factor productivity: evidence from China’s economic transition

Song, Kaiyi; Bian, Yuanchao; Zhu, Chen; Nan, Yongqing

Impacts of dual decentralization on green total factor productivity: evidence from China’s economic transition

2020

Song, Kaiyi | Bian, Yuanchao | Zhu, Chen | Nan, Yongqing

China’s fiscal decentralization has the dual characteristics of revenue decentralization and expenditure decentralization, and their impacts on green total factor productivity are also different. By calculating the Malmquist-Luenburger index and using the Spatial Durbin Model, this study examines the effects of dual decentralization on green total factor productivity (GTFP) from the perspective of fiscal competition. It was found that revenue decentralization significantly hindered the improvement of a local area’s GTFP, and that the impact of fiscal revenue competition on a local area’s GTFP is also significantly negative. The expenditure decentralization and the fiscal expenditure competition among different areas are conducive to improving the local area’s GTFP. Moreover, the impact of revenue decentralization on efficiency improvement is significantly negative, while the expenditure decentralization is conducive to technical progress. All these findings may provide enlightenment for optimizing China’s fiscal decentralization and promoting high-quality economic development.

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