معاوضه بین رشد و عدالت در سیاست تمرکز زدایی : تجربه چین

This paper investigates the potential tradeoff between economic growth and regional equity in the design of fiscal decentralization policy in the context of China's experience. We develop a theoretical model of fiscal decentralization, where overall national economic growth and equity in the regional distribution of fiscal resources are the two objectives pursued by the central government. The model is tested using panel data for 1985–98. We find that fiscal decentralization in China has led to economic growth as well as to significant increases in regional inequality.

The fundamental objective behind China's economic reform starting in the early 1980s was to develop the country's economy in view of the failure of the socialist planning model. A basic premise of this strategy was to decentralize decision making with the belief that local governments could allocate some of the available resources more efficiently than the central government had done until then. Close to twenty years of decentralization reforms have followed during which the share of central government expenditure in the general public sector budget decreased from about half in the beginning of the 1980's to a little over one-fourth in 1998. China's economic strategy explicitly accepted that economic growth would not benefit all regions the same, but would let at least some of them have more opportunities to catch up with the global economy. As former leader Deng Xiaoping had put it: “Let part of us be richer first.” The relationship between growth and equity in the distribution of income 1 has been widely discussed in the economics literature.2 There has been much less research on the relationship between growth and inequality in the geographic distribution of resources or fiscal disparities, though there has been a recent debate in the decentralization literature as to whether fiscal decentralization accelerates or retards economic growth.3 On the other hand, there seems to be a general agreement in the decentralization literature that, all else being equal, unfettered fiscal decentralization can lead to a concentration of resources in a few geographic locations.4 To the best of our knowledge, no empirical analysis of the impact of decentralization on the geographical distribution of resources has been done. The purpose of this paper is two-fo

In this paper, we have investigated the possibility of a tradeoff between economic growth and regional equity in decentralization policy, in the context of China's recent history with decentralization. Our empirical results have given qualified support to the existence of this type of tradeoff. The tradeoff would appear to put China policymakers on the horns of a dilemma. While the rate of economic growth in China has been quite high over approximately the last two decades, inequality in the distribution of fiscal resources across local governments has increased significantly. To facilitate our investigation, we have developed several theoretical models of fiscal decentralization, where overall national economic growth and equity in the distribution of fiscal resources among subnational governments are the two objectives pursued by the policy maker. According to our theoretical models, under some general conditions, there is a tradeoff between economic growth and regional equity. Our theoretical predictions have been tested using panel data covering the 1985 to 1998 period of fiscal decentralization in China. Two other findings are noteworthy apart from the finding confirming the existence of a tradeoff between economic growth and regional equity. First, fiscal decentralization significantly affected economic growth. A higher level of decentralization led to a higher growth, but as expected, this relationship was non-linear. At the same time, decentralization policies in China led to significant increases in inequality in the geographical distribution of fiscal resources. Second, contrary to some common belief, the existence and use of extra-budgetary funds helped to alleviate disparities in the distribution of fiscal resources.