A research on the appropriate level of sub-national borrowing in China--based on an analytical framework of econom
Read
DownLoad |
| Title | A research on the appropriate level of sub-national borrowing in China--based on an analytical framework of econom
|
| Author | Baoyun Qiao Lezheng Liu Shen Guo and Xiaoyun Zhang |
| Organization | China Academy of Public Finance and Public Policy,Research Institute for Fiscal Science |
| Email | baoyun.qiao@gmail.com,lezhengliu@gmail.com,sguo.cufe@gmail.com,zxyun1124@126.com |
| Key Words | Sub-national borrowing; Economic growth; Social welfare; Debt risk |
| Abstract | Based on an analytical framework of economic growth, social welfare and risk, this paper endeavours to estimate the appropriate level of sub-national borrowing in China. According to results of the empirical study we conduct, if only considering the optimal economic growth, the appropriate level of sub-national borrowing in China should be above 3430 billion; if we consider the maximization of social welfare, the appropriate level of sub-national borrowing in China should be below 8270 billion. The present size of sub-national liabilities in China has exceeded the estimated possible upper bound, which indicates a high level of fiscal risks and calls for policies of risk control. |
| Serial Number | WP178 |
| Time | 2012-02-14 |
|