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Discrete Dynamics in Nature and Society
Volume 2016 (2016), Article ID 6597138, 14 pages
http://dx.doi.org/10.1155/2016/6597138
Research Article

Fiscal Decentralization and Regional Financial Efficiency: An Empirical Analysis of Spatial Durbin Model

1College of Economics and Trade, Hunan University, Changsha, Hunan 410079, China
2Hunan University of Finance and Economics, Changsha, Hunan 410025, China

Received 18 January 2016; Accepted 19 April 2016

Academic Editor: Alicia Cordero

Copyright © 2016 Jianmin Liu et al. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

Based on panel data covering the period from 2003 to 2012 in China’s 281 prefecture-level cities, we use superefficiency SBM model to measure regional financial efficiency and empirically test the spatial effects of fiscal decentralization on regional financial efficiency with SDM. The estimated results indicate that there exist significant spatial spillover effects among regional financial efficiency with the features of time inertia and spatial dependence. The positive promoting effect of fiscal decentralization on financial efficiency in local region depends on the symmetry between fiscal expenditure decentralization and revenue decentralization. Additionally, there exists inconsistency in the spatial effects of fiscal expenditure decentralization and revenue decentralization on financial efficiency in neighboring regions. The negative effect of fiscal revenue decentralization on financial efficiency in neighboring regions is more significant than that of fiscal expenditure decentralization.