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Early Warning Model of Local Governments¡¯ Debt Risk in China Based on the Financial Perspective

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  • Feng Zheng
  • Feng Ye

Abstract

By studying Chinese government local debt scale, analyzing cause and risk, we can draw the conclusion ¡°local government debt in China is brewing a crisis. Apparently, it is the crisis in the financial control, but it may not only financial control crisis, and it may lead to financial overall crisis, or even cause the Government¡¯s overall governance crisis.¡± Finally, using multilevel structure analysis and by the means of index system made from economics, social uncontrollable exogenous factors, this paper puts forward the debt risk assessment consist of ¡°converse index¡± and ¡°positive indication¡± . At the same time, it uses the Delphi method to weight index for the purpose of reducing subjective measurement and evaluation. On this basis, we hope to give same suggestion to the government for avoiding the debt risk.

Suggested Citation

  • Feng Zheng & Feng Ye, 2013. "Early Warning Model of Local Governments¡¯ Debt Risk in China Based on the Financial Perspective," Business and Management Research, Business and Management Research, Sciedu Press, vol. 2(4), pages 129-135, December.
    • Handle: RePEc:jfr:bmr111:v:2:y:2013:i:4:p:129-135
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    References listed on IDEAS

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    1. L. Lin & J. Piesse, 2004. "Identification of corporate distress in UK industrials: a conditional probability analysis approach," Applied Financial Economics, Taylor & Francis Journals, vol. 14(2), pages 73-82.
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    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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