China's Fiscal Decentralization: consequences for the promotion of local development

Abstract

Fiscal decentralization has been an integral part of China's decentralization process, which successfully promoted local government entrepreneurialism. But while fiscal reform gave governments increasing authority overlocal revenue, theyhave also faced increasing expenditure responsibilities. This article aims to analyze the processes of fiscal decentralization that was put in place in the early 1980B, and to elucidate on the rationale and consequences of that process.