Analysis of the Relationship between Local Fiscal Autonomy Reform and the Efficiency of Public Service Provision

This paper discusses the complex relationship between the reform of local fiscal autonomy and the efficiency of public service supply in China. The article first combs the historical process and current characteristics of China's fiscal decentralization reform, and points out that the current local fiscal autonomy is limited and the regional differences are significant. Theoretical analysis reveals that fiscal autonomy affects the efficiency of public service supply through the four mechanisms of resource acquisition, incentives and constraints, information advantage and innovation drive, and is regulated by China's unique "political championship", the central assessment system and other factors. The results show that appropriate fiscal autonomy helps to improve the matching degree of public services and local demand, stimulate supply innovation and improve the efficiency of financial resources; But at the same time, it may also lead to challenges such as widening regional gap, short-term tendency of public services and debt risk. The article further analyzes the institutional constraints of China's unitary structure, multi-objective governance system and regional capacity differences. Finally, this paper proposes a systematic reform path: building a clear fiscal relationship with rights and responsibilities, improving the incentive and restraint mechanism, promoting the innovation of supply mode and strengthening the supporting system, emphasizing the balance between maintaining the central control ability and giving local appropriate autonomy, so as to achieve the dual goals of improving the efficiency of public service supply and equalization of basic public services.