摘要
If fiscal decentralization promotes growth,why do some regions decentralize more than others?This article identifies the growing divergence of fiscal centralization among Chinese cities and explains it in a public finance framework.It argues that fiscal decentralization and its economy-liberalizing effect entail significant short-term fiscal risk.The more a locality relies on uncompetitive business ownership for fiscal revenue,the less likely fiscal decentralization is to occur.This article compiles a dataset of 20 provincial capitals between 1999 and 2016 to test for the connection between a city's tax base and its fiscal centralization level.It then pairs two"most similar"cities to trace how fiscal security concerns drove their fiscal and economic policies apart.This article adds a micro-level perspective to the literature on fiscal federalism.By pointing out the fiscal constraints confronting local governments,it offers a new angle to understand the different growth paths of Chinese cities.
