DONG Li,ZHANG Qichun：The Impact of Local Government Public Expenditure Size on Migration in China: A Dynamic Spatial Panel Data Approach

Abstract：Based on data of 31 provinces in China from 1997 to 2012, this paper establishes a dynamic spatial panel data model. The empirical results show that there is a monotonous positive relationship between public expenditure size and migration. Productive effect is significantly positive and tax effect is not significant. Provinces of similar capita GDP are competitive in population migration, but neighboring provinces are co-ordinate in migration, and these effects are hysteretic. Public expenditure size of a province has not only a significant impact on its own net migration (direct effect), but also a spillover effect on its neighbor provinces (indirect effect). In the short run, direct effect overweighs direct effect. In the long run, the gap between two effects gets narrowed, and indirect effect gradually becomes prominent.

Key words： Local Government    Public Expenditure Size    Population Migration    Dynamic Spatial Panel Data Model

source:Finance & Trade Economics ,No.12,2014