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China's Local Political Budget Cycles

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  • Gang Guo

Abstract

This article examines the political budget cycles in Chinese counties. The shift to a more performance‐based cadre evaluation and mobility system during the reform era has created an incentive structure for local leaders to increase government spending at strategically important time points during their tenure to enhance the prospect of official promotion. Such expenditures help local leaders to impress their superiors with economic and political achievements, especially those visible and quantifiable large‐scale development projects. At the same time, economic and fiscal decentralization increased the capacity of local leaders to influence government budget expenditures as the need rises. The hypothesized curvilinear relationship between a leader's time in office and increased spending was tested using a comprehensive data set of all Chinese counties from 1997 through 2002. The panel data analysis shows that growth in local government spending per capita is the fastest during a leader's third and fourth years in office.

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  • Gang Guo, 2009. "China's Local Political Budget Cycles," American Journal of Political Science, John Wiley & Sons, vol. 53(3), pages 621-632, July.
    • Handle: RePEc:wly:amposc:v:53:y:2009:i:3:p:621-632
    DOI: 10.1111/j.1540-5907.2009.00390.x
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    17. Fi̇li̇z Eryilmaz & Mehmet Mercan, 2015. "Political Budget Cycles: Evidence From Turkey," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 2, pages 5-14, April.
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    25. Shen, Shiran V & Wang, Qi & Zhang, Bing, 2023. "Regularized Campaigns as a New Institution for Effective Governance," Institute on Global Conflict and Cooperation, Working Paper Series qt0d83b2rw, Institute on Global Conflict and Cooperation, University of California.

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