Title: Research on the China's performance of public expenditure from the perspective of budget balance

Authors: Zhenyang Wang; Kai Wang

Addresses: Central University of Finance and Economics, No. 39 Xueyuan South Road, Haidian District, Beijing, China ' Central University of Finance and Economics, No. 39 Xueyuan South Road, Haidian District, Beijing, China

Abstract: Based on the panel data of 31 provincial administrative regions in China from 2006 to 2015, this paper uses factor analysis and DEA-Malmquist efficiency evaluation method to design seven result-oriented public expenditure performance index systems in different fields of public finance, and then establishes the generalised method of moments (GMM) with the budget balance measurement indicators of different cycle lengths, so as to empirically test and analyse the impact of annual, cross-annual and multi-year budget balance on the change of public expenditure performance index. The results show that: 1) on the whole, the multi-year budget balance plays a significant role in promoting the performance of public expenditure; 2) specifically, in more developed regions, the effect of using annual budget balance is more obvious; 3) in less developed regions, the use of cross-year budget balance mechanism is more conducive to the performance of public expenditure.

Keywords: budget balance; public expenditure; expenditure performance; medium-term fiscal planning; DEA-Malmquist; data envelopment analysis; DEA; generalised method of moments; GMM; factor analysis; China.

DOI: 10.1504/IJCCM.2022.123669

International Journal of Chinese Culture and Management, 2022 Vol.5 No.3, pp.203 - 223

Received: 17 Jul 2020
Accepted: 07 Mar 2021
Published online: 30 Jun 2022 *

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