Debt authority and intentional overstatement of budgetary deficit: evidence from Chinese Provinces

Zhiyong An; Yilin Hou

doi:10.1007/s10797-019-09561-w

Debt authority and intentional overstatement of budgetary deficit: evidence from Chinese Provinces

Zhiyong An, Yilin Hou

Department of Public Administration

Research output: Contribution to journal › Article › peer-review

1 Scopus citations

Abstract

This paper takes advantage of China’s 2011 “debt decentralization” reform to identify its causal impact on the budgetary deficit of Chinese subnational governments (SNGs) by employing a difference-in-differences approach. We use data on Chinese SNGs from 2009 to 2014 to implement the analysis. We find that debt decentralization can help contain the intentional overstatement of budgetary deficit by SNGs. We argue that our finding carries wider policy implications even beyond China.

Original language	English (US)
Pages (from-to)	461-477
Number of pages	17
Journal	International Tax and Public Finance
Volume	27
Issue number	2
DOIs	https://doi.org/10.1007/s10797-019-09561-w
State	Published - Apr 1 2020

Keywords

Budgeting
Debt
Deficits
Fiscal decentralization
Intergovernmental relation

ASJC Scopus subject areas

Accounting
Finance
Economics and Econometrics

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10.1007/s10797-019-09561-w

Cite this

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abstract = "This paper takes advantage of China{\textquoteright}s 2011 “debt decentralization” reform to identify its causal impact on the budgetary deficit of Chinese subnational governments (SNGs) by employing a difference-in-differences approach. We use data on Chinese SNGs from 2009 to 2014 to implement the analysis. We find that debt decentralization can help contain the intentional overstatement of budgetary deficit by SNGs. We argue that our finding carries wider policy implications even beyond China.",

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author = "Zhiyong An and Yilin Hou",

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N2 - This paper takes advantage of China’s 2011 “debt decentralization” reform to identify its causal impact on the budgetary deficit of Chinese subnational governments (SNGs) by employing a difference-in-differences approach. We use data on Chinese SNGs from 2009 to 2014 to implement the analysis. We find that debt decentralization can help contain the intentional overstatement of budgetary deficit by SNGs. We argue that our finding carries wider policy implications even beyond China.

AB - This paper takes advantage of China’s 2011 “debt decentralization” reform to identify its causal impact on the budgetary deficit of Chinese subnational governments (SNGs) by employing a difference-in-differences approach. We use data on Chinese SNGs from 2009 to 2014 to implement the analysis. We find that debt decentralization can help contain the intentional overstatement of budgetary deficit by SNGs. We argue that our finding carries wider policy implications even beyond China.

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KW - Deficits

KW - Fiscal decentralization

KW - Intergovernmental relation

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Debt authority and intentional overstatement of budgetary deficit: evidence from Chinese Provinces

Abstract

Keywords

ASJC Scopus subject areas

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