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《Research on Financial and Economic Issues》 2008-05
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Research on the Central and Local Governments' Boundary in China's Economic Development——From the Perspective of Incomplete Contract Theory

PI Jian-cai(China Center for Economic Research,Peking University,Beijing 100871,China)  
This paper analyzes the relationship between the central government and local governments from the perspective of incomplete contract theory,and resolves their boundary based on above analysis in terms of economic efficiency.Our analyses show that centralization will reduce the local governments' motivation to exert effort,and that decentralization will increase the local governments' initiative.When the central government decides whether to centralize or decentralize,we should consider both the externalities that the central government and local governments impose on each other and the utility function forms which are used as the benchmark.The process of demarcating the boundary is a process of institutional change accompanied by economic development,which improves the economic efficiency.
【Fund】: 中国博士后科学基金资助项目(20070420008)
【CateGory Index】: D630
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【Citations】
Chinese Journal Full-text Database 4 Hits
1 HUANG HAI-Ying(Kingbridge Bnsiness Institnte,Dongbei University of Finance and Ecoromics,Dalian,116021 China);Legal Division of the Responsibilities and the Authority of Finance between the Central and the Local Government[J];Journal of Dongbei University of Finance and Economics;2006-04
2 Pi Jiancai(China Center for Economic Research, Peking University);Ownership Structure,Selfish Effort,and the Holdup Problem[J];Economic Research Journal;2007-05
3 Su Li;The Division of Power between the Central and Local Governments in Contemporary China: Reinterpretation of Chapter Five of “On the Ten Prominent Relations” by Mao Zedong[J];Social Sciences In China;2004-02
4 ZUO Feng;Analysis of the Games between Central Authority and Local Authority in the Field of Macroeconomic Control[J];Journal of Central University of Finance & Economics;2007-07
【Co-citations】
Chinese Journal Full-text Database 10 Hits
1 WANG Yong LI Guang-bin;Re-thinking on the values of urban planning[J];Urban Problems;2006-09
2 LIU Fang-quan,CAO Wen-an(Fujian Public Security Academy,Fujian Fuzhou 350007,China);Discussion on class supervision in penal proceedings[J];Journal of Chongqing Technology and Business University(Social Science Edition);2006-03
3 XIONG Yi(Department of Economics,Zhongnan University of Economics and Law,Wuhan,Hubei 430060,China);The Efficacy of Local Government Economic Behavior as a Political Principal-agent Problem[J];Journal of Guizhou College of Finance and Economics;2006-06
4 XU Xianxiang1and CHEN Xiaofei2 1,2 Lingnan College,Sun Yat-Sen University;Special Economic Zones Blaze New Trails[J];中国经济学人(英文版);2008-04
5 Li Yu-feng;Reflection on Idea/Expression Dichotomy in Copyright Law[J];Peking University Law Review;2007-02
6 Peng Bing(Law School,Peking University,Beijing 100871,China);Corporate Governance in Listed Companies:The Relationship between Central and Local Governments[J];Journal of Peking University(Philosophy & Social Sciences);2008-06
7 Liang Zhijian;Kommentar zum Urteil des deutschen Bundesverfassungsgerichts gegen das ”Finanzausgleichgesetz“ (1999): Erfahrungen vom Finanzausgleichgesetz im deutschen verfassungsrechtlichen Rahmen[J];Deutschland-studien;2006-01
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9 ZHAO Guo-dang et al(College of Economics and Management,Henan Normal University,Xinxiang,Henan 453007);Economic Study on How to Improve Income of Migrant Workers[J];Journal of Anhui Agricultural Sciences;2007-33
10 LONG Miao,ZHENG Meng(Economics School,Zhongnan University of Economics and Law,Wuhan 430060,China);Market and Local Protectionism:An Analysis Model Based on Market Property Right[J];Commercial Research;2008-03
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1 Zhan Weiping, Yu Yongda (School of Public Policy and Management, Tsinghua University, Beijing, 100084;);Dual Management Analysis form Common Agency Aspects[A];[C];2008
2 ;How to Solve the Incentives Dilemma in the China's Decentralization Reform?--An Analysis from the Contractual Perspective[A];[C];2007
3 LEI Yan-hong;A Literature Review on the Relationship between the Central and Local Governments since the Reform and Opening-up[A];[C];2008
【Secondary Citations】
Chinese Journal Full-text Database 10 Hits
1 LI Jun-jie, ZHOU Wei-feng(Graduate School of CASS, Beijing 100102, China);The Equilibrium of Economic Growth Promoted By Local Government[J];Modern Economic Science;2005-02
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4 Kou Tiejun Northeastern University of Finance & Economics, 116025;A Study on the Improvements of Fiscal Transfer Payment System in China[J];Finance & Trade Economics;2004-05
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