Education Journal


2014.第42卷第2(Vol. 42 No. 2).pp. 1–21


The Impact of Intergovernmental Fiscal Transfers on the Level and Disparity of Educational Expenditure at the County Level in China

黃斌、董雲霞、苗晶晶(Bin HUANG, Yunxia DONG, & Jingjing MIAO)





Based on data collected from 1,985 counties in 2007 and using quantile regression method, this article examines the impact of different types of intergovernmental fiscal transfers on local public educational expenditure at the county level in China. Special attention has been paid to the fungibility of the subsidy for rural compulsory education and the potential influence from such a subsidy on inter-county disparity of educational expenditure. Results show that most intergovernmental fiscal transfers have a substitutive effect on local educational expenditure while the subsidy for rural compulsory education from the central government has a crowding-out effect on educational expenditure of local governments. The percentage of fungibility of fiscal subsidy for rural compulsory education has reached beyond 50% nationwide. Although the fiscal subsidy ameliorates the inter-county disparity of educational expenditure in the whole, patterns of the influence are different among areas. To be specific, Middle and East China have seen over 69% fungibility of the subsidy and a deteriorated effect from the subsidy on the inter-county diaparity. West China, nonetheless, has experienced not only the growth of local educational expenditure but also an improvement of inter-county disparity of educational expenditure after receiving the subsidy for rural compulsory education from the central government.

Keywords: fiscal transfers; public education expenditure; fungibility; inter-county disparity