QIN Hailin:A Theoretical Framework and an Empirical Test on the Fiscalization of Financial Risk

Abstract：In order to eliminate the huge negative externality of financial risk, an action of fiscalization of financial risk would be taken by government at a crucial moment, which is an equilibrium solution of a series of institutional games in the political and economic market. Once the secondary action group was encouraged by the first action group in a special institutional environment and an institutional instrument was presented to create the external income of institutional innovation, governmental action of fiscalization of financial risk would happen with an innovation of measures or changes of strength. The empirical results based upon logit model indicates that the reform of fiscal institution, financial deepening and DWKF indeed have an obvious effect upon governmental behavior choice of fiscalization of financial risk and such an effect presents different characteristics before and after the tax-sharing reform. In short, when government reasonably makes use of fiscalization of financial risk, it should carry out a matched institutional innovation so that an institutional coupling based on Pareto improvement of resource allocation would be constructed.

Key words： Fiscalization of Financial Risk   Institutional Coupling   Logit Model   Action Group   External Benefits

source:Finance & Trade Economics ,No.7,2014