The Long-Term Impact on Local Government Finance from the Perspective of Shrinking Cities-Taking Huaibei City as an Example

Abstract

With the advancement of global urbanization, many cities are facing the challenges of population decline and economic decline, especially coal cities with a resource-based economy. Huaibei City, as a typical coal city in China, has gradually entered a stage of urban shrinkage in recent years, manifested by problems such as population decline, reduced economic activities, and aging infrastructure. This article systematically studies the specific impact of urban shrinkage on local government fiscal revenue and expenditure by analyzing Huaibei City's fiscal data and policy effects. The study found that urban shrinkage has led to a sharp decline in tax revenue and land transfer revenue, while fiscal expenditures on infrastructure maintenance and social security have continued to increase, putting tremendous pressure on local finances. On this basis, this article puts forward a series of policy recommendations to help local governments cope with the financial challenges caused by urban shrinkage and ensure the sustainable development of cities. This study not only enriches the theoretical research on urban shrinkage and local financial management, but also provides practical reference for policy formulation in similar cities.