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[Abstract] Chinese local governments play an important role in the local economic development because of the formation of China’s regional economic model after the Reform and Opening Policy in 1978. Based on the curiosity on what are the Chinese local governments’ roles on the local economic development， I came up the research questions on local governments’ role on macro regulation， participation and cooperation. In this paper I will talk about each question in detail.
[Keywords] China； Local governments；Regional economy；Pearl River Delta
In 2010， China became to the second largest economy in the world. There were many reasons that have contributed to the rapid economic development of China and one of them was the Reform and Opening policy in 1979. According to Barna’s book， this policy totally changed the China’s economic development model .
China started the preparation of regional economic integration under the Reform and Opening policy and after these years development we can easily distinguish regions economic problems. Even after 1979， China's economy turned into Local Government Leading Model from Central Government Leading Model ， which means the local governments of each region can develop economy according their own comparative advantages. However， the gap between rich regions and poor regions is growing wider and becoming more apparent. Therefore， solving the imbalance problem between regions is a significant challenge for China’s economy development and exerting local governments’ functions is one of the solutions.
Therefore， the purpose of this article is to discuss the significance of local governments for China’s regional economic development and how local governments affect their economic development. Based on the theory of Government Economies， the research questions of this study are---how do Chinese coastal local governments play macro-regulatory role， participation role and cooperative role in China's regional economic development？ And by using the one shot case study as research design to observe the local governments in Pearl River Delta Region（PRD） after Reform and Opening Policy and used content analysis as research method.
Before star to analyze any data， Government Economics theory is the main theoretical concept of this research. It is also known as Public Economics or Public Sector Economics. It is a science that focuses on the government economic behaviors， the relations among government， private sector and the government economic activity regularity. Michael Porter， the famous strategic management expert in Harvard Business School came up the Diamond Model in 1990 imphasized the functions of government in economic mainly have five. The first is to build a stable and predictable macro environment. Second is to improve the efficiency and quality of the infrastructure construction system. Third is to formulate the regulations and incentive methods to improve the competition of productivity. Fourth is to improve the development of Enterprises Cluster. Fifth is to build a positive institutional mechanism to muster the productivity of the central government， local government， companies， social institutions and citizens. Also， according to Sun Rong and Xu Jie's book "The Government Economics" ， she mentioned the government economic functions on macro-economy stability， governments’ participation and cooperation.
Therefore， combining the Michael Porter’s Diamond Model and Government Economics Theory， I summarized the China’s local government’s economic functions into macro regulations role which include monetary policy and infrastructure construction to influence the regional economic structure； government participation role which means local governments make themselves as independent artificial persons to get involved in market economic activities； and industrial coordination role which means local governments start to find the cooperation with one another to gain more enterprises investments， free circulation of commodities and common interests to keep the balance between local's interests.
Macro Regulatory Roles
By classifying and analyzing the data that I collected， I found out Chinese local government’s macro regulatory roles mainly had three aspects which are Industrial Transformation， Economy and Environment and Infrastructure Construction.
Industrial Transformation： The first major method of local governments’ macro regulatory role is by policy guidance. The local governments first position themselves according to the geographic factor and resources factor and then find out the proper industries to develop. Then， by policy guidance the local governments led the industrial transformation. For example， the government in Guangzhou tried to transform the old traditional industries into modern industries by developing automobile manufactory， electronics manufactory and petrochemicals.
The second major method is by administrative forces. Exemplify Zhongshan city， the government used the administrative measures to force the labor-intensive industries relocate in order to upgrade the industrial structure. Also for Dongguan， the government mandatory required the processing industries moving out the city in order to gradually transform to tertiary industries. Economy and Environment： The macro regulatory role of local governments in the PRD is the role in stabilizing the environment under the economic development. By implementing the central policy on sustainable development， the local governments in each city in the PRD region all made efforts in balancing the economy and environment. By analyzing the data， I found out two major aspects of local governments environment protection on economic development in the PRD region. One was policy guidance and the other one was technology recommendation.
For example， Guangzhou city kept the economic growth with the good environment quality by the local governments’ policies on industries distribution， relocation of serious pollution businesses and adoption of advanced pollution control technology. Also like Foshan and Zhuhai used the concept of Ecological Economic Development. The local governments put nearly six billion RMB to developed advanced manufacture； low-carbon economy and circular economy； modern industries and high-tech industries； also strictly controlled the construction of some enterprises which were serious environmental polluted.
Construction of Infrastructure： The third major macro regulatory role of the local governments in the PRD region is the construction of Infrastructure. By analyzing the data I found out two major purposes in construction of infrastructure. One was the convenience of the city and the other one was to improve the investment environment of the city.
Cooperation Roles
The third research question is trying to find out the main roles of Chinese local governments in cooperation. By analyzing the data in the 9 different cities of the PRD region， I found out the cooperation functions of local governments in the PRD can be sorted out in three aspects. They are logistics cooperation， tourism cooperation and industrial cooperation.
Logistics Cooperation： Because of the globalization and the integration of regions， the logistics industries tend to be integrated. Under the trend of eliminating the trade barriers and rational distributing resources， the logistic industry starts to become the basic element of regional economic development. What is more， the PRD region is near by the Hong Kong， which is the center of economy and logistics industry. Tourism Cooperation： One of the biggest industries in the PRD region is the tourism industry because of the economic integration of the PRD region and the cooperation with Hong Kong and Macao， the governments in the PRD region also paid attention to the tourism cooperation in the PRD region. By classifying and analyzing the data that I collected， I divided the Tourism Cooperation data into two parts which are Transportation and Policy Cooperation. The first important factor of tourism cooperation is the transportation. The local government in Guangzhou planned to build a Highway and Railway Passenger Line as the center of Guangzhou. Therefore， the construction of Guangzhou-Shenzhen highway and Guangzhou-Zhuhai highway can speed up the travel time.
The second important factor of tourism cooperation is the policy cooperation. By policy guidance， the local governments in the PRD region pushed the cooperation of tourism industry. Governments need to eliminate impediments with each city. For example， the rapid visa between Shenzhen and Hong Kong and also Zhuhai and Macao. Also the agreement on the Pearl River Delta Regional Tourism Integration Plan （2014- 2020） among 9 cities to achieve tourism integration.
Industrial Coordination： After the development of information industry， the local governments in the PRD region started to focus on the industrial cooperation to maximize the interests of each city. Because of the local protectionism， there used to be lack of communication and cooperation between the cities in the PRD region. Therefore， the industrial structure in the PRD region was nearly the same and caused the waste of resources. Recently the governments in the PRD region focus on the importance of industrial cooperation to form an industrial chain， especially with the tertiary industry development of Hong Kong and Macao which can provide the manufactory backstage to the PRD region. Therefore， the governments in the PRD region need to take the advantages of their comparative advantages and specialized production to improve the regional industrial cooperation.
The second one is the complementation of industries in the PRD region. The best way to maximize the interests of each city is to be specialized at specific area and cooperate with one another to form an industrial chain. For example， the secondary industries in Guangzhou mainly are heavy industries and transport machinery but the secondary industry in Foshan mainly is light industry processing， such as traditional household appliances. Therefore， on the one hand， Guangzhou can provide the raw material to Foshan manufacture. On the other hand， Guangzhou needs the production from Foshan to supply the huge consumer market.
CONCLUSION
Local governments play an important role on Chinese local economic development. By doing this research I find out how Chinese local governments affect the local economic development， which mainly by using macro-regulation， participation and cooperation to promote the local economy. Even though macro-regulation mainly carries out by the central government， but nowadays Chinese local governments also have the power to implement macro-regulation because of the Reform and Opening Policy. By focusing on the industrial transformation， construction of infrastructure and the environment protection， Chinese local governments in the PRD region make an effort to improve the local economy.
Referring to the research purpose which aims to answer the significance of Chinese local governments functions on local economic development. The response is positive. Nowadays， even most of the capitalist countries more focus on the effects of market and ignore the government’s economic functions because of the invisible hands idea of Adam Smith. However， China does not ignore the government’s economic functions in the market but also decentralized the power to the local governments in order to develop the local economy.
BIBLIOGRAPHY：
[1]See Barna Talas， Economic Reforms and Political Attempts in China 1979-1989， 1 ed.， Europe-Asia-Pacific Studies in Economy and Technology （Springer-Verlag Berlin Heidelberg， 1991）， 75-76.
[2]See N.Peirce & C. Johnson & J. S. Hall， How Urban America Can Proper in a Competitive World （Washington DC： Seven Locks Press， 1993）.
[3]See Guo Xiaocong， Government Economics （Beijing： China Renmi University Press， 2001）.
[4]See Michael E. Porter， The Competitive Advantage of Nations （Taiwan： Commonwealth Publishing 1996）.
[5]See Sun Rong and Xu Jie， The Government Economics， vol. 1 （Shang Hai： Fudan Press， 2001 ）， 13.
[6]Jie， Sun Rong and Xu. The Government Economics. Vol. 1. Shang Hai： Fudan Press， 2001
[7]N.Peirce & C. Johnson & J. S. Hall. How Urban America Can Proper in a Competitive World. Washington DC： Seven Locks Press， 1993.
[8]Porter， Michael E. The Competitive Advantage of Nations. Taiwan： Commonwealth Publishing 1996.
[9]Talas， Barna. Economic Reforms and Political Attempts in China 1979-1989. 1 ed. Europe-Asia-Pacific Studies in Economy and Technology： Springer-Verlag Berlin Heidelberg， 1991.
[10]Xiaocong， Guo. Government Economics. Beijing： China Renmi University Press， 2001.
作者簡介：
郭茜（1993.12-），女（汉族），山西省，台湾文藻外语大学，在校硕士，研究方向国际事务，国际经济与国际政治。
[Keywords] China； Local governments；Regional economy；Pearl River Delta
In 2010， China became to the second largest economy in the world. There were many reasons that have contributed to the rapid economic development of China and one of them was the Reform and Opening policy in 1979. According to Barna’s book， this policy totally changed the China’s economic development model .
China started the preparation of regional economic integration under the Reform and Opening policy and after these years development we can easily distinguish regions economic problems. Even after 1979， China's economy turned into Local Government Leading Model from Central Government Leading Model ， which means the local governments of each region can develop economy according their own comparative advantages. However， the gap between rich regions and poor regions is growing wider and becoming more apparent. Therefore， solving the imbalance problem between regions is a significant challenge for China’s economy development and exerting local governments’ functions is one of the solutions.
Therefore， the purpose of this article is to discuss the significance of local governments for China’s regional economic development and how local governments affect their economic development. Based on the theory of Government Economies， the research questions of this study are---how do Chinese coastal local governments play macro-regulatory role， participation role and cooperative role in China's regional economic development？ And by using the one shot case study as research design to observe the local governments in Pearl River Delta Region（PRD） after Reform and Opening Policy and used content analysis as research method.
Before star to analyze any data， Government Economics theory is the main theoretical concept of this research. It is also known as Public Economics or Public Sector Economics. It is a science that focuses on the government economic behaviors， the relations among government， private sector and the government economic activity regularity. Michael Porter， the famous strategic management expert in Harvard Business School came up the Diamond Model in 1990 imphasized the functions of government in economic mainly have five. The first is to build a stable and predictable macro environment. Second is to improve the efficiency and quality of the infrastructure construction system. Third is to formulate the regulations and incentive methods to improve the competition of productivity. Fourth is to improve the development of Enterprises Cluster. Fifth is to build a positive institutional mechanism to muster the productivity of the central government， local government， companies， social institutions and citizens. Also， according to Sun Rong and Xu Jie's book "The Government Economics" ， she mentioned the government economic functions on macro-economy stability， governments’ participation and cooperation.
Therefore， combining the Michael Porter’s Diamond Model and Government Economics Theory， I summarized the China’s local government’s economic functions into macro regulations role which include monetary policy and infrastructure construction to influence the regional economic structure； government participation role which means local governments make themselves as independent artificial persons to get involved in market economic activities； and industrial coordination role which means local governments start to find the cooperation with one another to gain more enterprises investments， free circulation of commodities and common interests to keep the balance between local's interests.
Macro Regulatory Roles
By classifying and analyzing the data that I collected， I found out Chinese local government’s macro regulatory roles mainly had three aspects which are Industrial Transformation， Economy and Environment and Infrastructure Construction.
Industrial Transformation： The first major method of local governments’ macro regulatory role is by policy guidance. The local governments first position themselves according to the geographic factor and resources factor and then find out the proper industries to develop. Then， by policy guidance the local governments led the industrial transformation. For example， the government in Guangzhou tried to transform the old traditional industries into modern industries by developing automobile manufactory， electronics manufactory and petrochemicals.
The second major method is by administrative forces. Exemplify Zhongshan city， the government used the administrative measures to force the labor-intensive industries relocate in order to upgrade the industrial structure. Also for Dongguan， the government mandatory required the processing industries moving out the city in order to gradually transform to tertiary industries. Economy and Environment： The macro regulatory role of local governments in the PRD is the role in stabilizing the environment under the economic development. By implementing the central policy on sustainable development， the local governments in each city in the PRD region all made efforts in balancing the economy and environment. By analyzing the data， I found out two major aspects of local governments environment protection on economic development in the PRD region. One was policy guidance and the other one was technology recommendation.
For example， Guangzhou city kept the economic growth with the good environment quality by the local governments’ policies on industries distribution， relocation of serious pollution businesses and adoption of advanced pollution control technology. Also like Foshan and Zhuhai used the concept of Ecological Economic Development. The local governments put nearly six billion RMB to developed advanced manufacture； low-carbon economy and circular economy； modern industries and high-tech industries； also strictly controlled the construction of some enterprises which were serious environmental polluted.
Construction of Infrastructure： The third major macro regulatory role of the local governments in the PRD region is the construction of Infrastructure. By analyzing the data I found out two major purposes in construction of infrastructure. One was the convenience of the city and the other one was to improve the investment environment of the city.
Cooperation Roles
The third research question is trying to find out the main roles of Chinese local governments in cooperation. By analyzing the data in the 9 different cities of the PRD region， I found out the cooperation functions of local governments in the PRD can be sorted out in three aspects. They are logistics cooperation， tourism cooperation and industrial cooperation.
Logistics Cooperation： Because of the globalization and the integration of regions， the logistics industries tend to be integrated. Under the trend of eliminating the trade barriers and rational distributing resources， the logistic industry starts to become the basic element of regional economic development. What is more， the PRD region is near by the Hong Kong， which is the center of economy and logistics industry. Tourism Cooperation： One of the biggest industries in the PRD region is the tourism industry because of the economic integration of the PRD region and the cooperation with Hong Kong and Macao， the governments in the PRD region also paid attention to the tourism cooperation in the PRD region. By classifying and analyzing the data that I collected， I divided the Tourism Cooperation data into two parts which are Transportation and Policy Cooperation. The first important factor of tourism cooperation is the transportation. The local government in Guangzhou planned to build a Highway and Railway Passenger Line as the center of Guangzhou. Therefore， the construction of Guangzhou-Shenzhen highway and Guangzhou-Zhuhai highway can speed up the travel time.
The second important factor of tourism cooperation is the policy cooperation. By policy guidance， the local governments in the PRD region pushed the cooperation of tourism industry. Governments need to eliminate impediments with each city. For example， the rapid visa between Shenzhen and Hong Kong and also Zhuhai and Macao. Also the agreement on the Pearl River Delta Regional Tourism Integration Plan （2014- 2020） among 9 cities to achieve tourism integration.
Industrial Coordination： After the development of information industry， the local governments in the PRD region started to focus on the industrial cooperation to maximize the interests of each city. Because of the local protectionism， there used to be lack of communication and cooperation between the cities in the PRD region. Therefore， the industrial structure in the PRD region was nearly the same and caused the waste of resources. Recently the governments in the PRD region focus on the importance of industrial cooperation to form an industrial chain， especially with the tertiary industry development of Hong Kong and Macao which can provide the manufactory backstage to the PRD region. Therefore， the governments in the PRD region need to take the advantages of their comparative advantages and specialized production to improve the regional industrial cooperation.
The second one is the complementation of industries in the PRD region. The best way to maximize the interests of each city is to be specialized at specific area and cooperate with one another to form an industrial chain. For example， the secondary industries in Guangzhou mainly are heavy industries and transport machinery but the secondary industry in Foshan mainly is light industry processing， such as traditional household appliances. Therefore， on the one hand， Guangzhou can provide the raw material to Foshan manufacture. On the other hand， Guangzhou needs the production from Foshan to supply the huge consumer market.
CONCLUSION
Local governments play an important role on Chinese local economic development. By doing this research I find out how Chinese local governments affect the local economic development， which mainly by using macro-regulation， participation and cooperation to promote the local economy. Even though macro-regulation mainly carries out by the central government， but nowadays Chinese local governments also have the power to implement macro-regulation because of the Reform and Opening Policy. By focusing on the industrial transformation， construction of infrastructure and the environment protection， Chinese local governments in the PRD region make an effort to improve the local economy.
Referring to the research purpose which aims to answer the significance of Chinese local governments functions on local economic development. The response is positive. Nowadays， even most of the capitalist countries more focus on the effects of market and ignore the government’s economic functions because of the invisible hands idea of Adam Smith. However， China does not ignore the government’s economic functions in the market but also decentralized the power to the local governments in order to develop the local economy.
BIBLIOGRAPHY：
[1]See Barna Talas， Economic Reforms and Political Attempts in China 1979-1989， 1 ed.， Europe-Asia-Pacific Studies in Economy and Technology （Springer-Verlag Berlin Heidelberg， 1991）， 75-76.
[2]See N.Peirce & C. Johnson & J. S. Hall， How Urban America Can Proper in a Competitive World （Washington DC： Seven Locks Press， 1993）.
[3]See Guo Xiaocong， Government Economics （Beijing： China Renmi University Press， 2001）.
[4]See Michael E. Porter， The Competitive Advantage of Nations （Taiwan： Commonwealth Publishing 1996）.
[5]See Sun Rong and Xu Jie， The Government Economics， vol. 1 （Shang Hai： Fudan Press， 2001 ）， 13.
[6]Jie， Sun Rong and Xu. The Government Economics. Vol. 1. Shang Hai： Fudan Press， 2001
[7]N.Peirce & C. Johnson & J. S. Hall. How Urban America Can Proper in a Competitive World. Washington DC： Seven Locks Press， 1993.
[8]Porter， Michael E. The Competitive Advantage of Nations. Taiwan： Commonwealth Publishing 1996.
[9]Talas， Barna. Economic Reforms and Political Attempts in China 1979-1989. 1 ed. Europe-Asia-Pacific Studies in Economy and Technology： Springer-Verlag Berlin Heidelberg， 1991.
[10]Xiaocong， Guo. Government Economics. Beijing： China Renmi University Press， 2001.
作者簡介：
郭茜（1993.12-），女（汉族），山西省，台湾文藻外语大学，在校硕士，研究方向国际事务，国际经济与国际政治。