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  • 2015 Fall: Volume 14, Issue 2
  • Local Government Debt, a Time-bomb for China’s Economy?

    • Zhou Ming Matt ;
    • Wang Man Cang ;
    • Ni Ming Ming

    Use this link to view the PDF file: Local Government Debt, a Time-bomb for China’s Economy?

    Title:

    Local Government Debt, a Time-bomb for China’s Economy?

    Author(s):

    Zhou Ming Matt
    Wang Man Cang
    Ni Ming Ming

    Publication Date:

    2015

    Journal Title:

    The Journal of Finance Issues

    Volume Number:

    14

    Issue Number:

    2

    Abstract:

    China's national audit office reported huge debt accumulated at all levels of local governments in recent years. This paper aims to explain the factors contributing to the local government debt in China with empirical study on the economic development data. The relationship of government debt and economic ratios is examined with the auto-regressive linear equation constructed between the local government debt, fiscal income, GDP growth rate and CPI. Granger causality test is performed to find the granger cause of local government debt from previous year’s data. From the analysis, the risk of local government debt is evaluated from the global settings. Policy implications and suggestions are presented at the end.

    First Page:

    1

    Last Page:

    11

    Total Pages:

    11