The primary focus of this paper is to investigate whether the province directly administered counties (PDAC) reform,the decentralization of fiscal power from prefectures to counties,has promoted economic growth at the county level.Theoretically,no unequivocal conclusion has been reached on the relationship between fiscal decentralization and economic growth,especially when it involves assignment of expenditure responsibilities.Applying the Difference-in-Differences (DID) method to county level data during 2000-2013,our empirical analysis finds that,compared with non-reform counties,the PDACs achieve an annual GDP growth rate that is 1.819 percentage points lower than that of the non-PDACs.The policy effects are even larger with the passage of time,with the impact becoming-3.137 in the seventh year (2009-2010).This result is robust to different variations of the regressions and remains valid even when PSM method is applied.We further investigate the reasons for the slower economic growth rate in those PDACs.We find that,at least for our sample,lower administrative efficiency;lower investments in water conservancy and irrigation projects;lack of coordination from other counties;fewer transfers from upper-level governments;less incentive in attracting mobile capital investments,and lower investment in education,all contribute to the slower economic growth.