Author(s):Shaoan HUANG

2．Title：On the Shoulder of Ronald Coase

Author(s):Jiande LI

3．Title：Historical Origin, Formation and Evolution of Constitutional Democracy of Europe in the Medieval and Modern Time

Author(s):Weisen LI

Abstract:The interrelations and interplay between the constitutional democracy and economic development have been an animated topic in both economics and political sciences in recent years and it deserves further study and exploration in the current situation of the contemporary Chinese society. In order to provide some background knowledge for further study of the interrelations between the constitutional democracy and economic development and for searching a desired way of China political reform in future, this paper tries to give a brief but an overall review of the origin, formation and evolution of constitutional democratic system in the Western Europe in the medieval and modern time. The first section traces the etymological origin, and clarifies the meaning of constitution in the Standard European Average, and it also specifies multiple Chinese translations of the term of constitution? The second, third and fourth sections study formation, construction and evolution of constitutional democratic polity in England, France and Germen respectively. It is found that in contrast to the incremental and relatively peaceful formation of modern constitutional democracy in England, the democratic polity in France was constructed in a long period of violent revolutions. From a point of view that the nature of constitutional democracy is limited power of government, the multiplicity of German states before 19th century could be regarded as a particular loose constitutional democratic polity in a special kind of feudal-monarchal system? in the German Empire. The fifth section makes a thorough inquiry about the causes and origins of the modern constitutional democratic polity and legal property systems in the Western Europe and finds that the legal system and legal theories and noblemen democratic democracy in ancient Greek and in Ancient Roman, cultural spirit of the Hebrew and religious beliefs of the Christianity, particularly the Calvinist and Puritan beliefs formed during the Protestant Reform period in the Western Europe have played some fundamental roles in the formation, construction and evolution of the constitutional democratic polity in the Western Europe in the medieval and modern time.

Key Words:Constitution, constitutional democracy, rule of law, market order.

JEL Classifications：N13 N23 N43

4．Title：Fiscal Federalism: A Framework of Order for Government Competition in China?

Author(s):Xingyuan FENG

Abstract: Government competition exists in the political, economic, fiscal and other fields in China. It implies advantages and disadvantages. A total ban isneither feasible nor desirable. One needs to consider how to establish and maintain a framework of order for government competition in order to protect fair competition and prevent unfair competition. The traditional principles of fiscal federalism are based on the presumption of "benevolent government", implying an inherent trend of fiscal centralization, and attempting to stifle fiscal competition within the governmental sytem. By abandoning the above presumption, this paper develops “modified principles of fiscal federalism”, or even “perfect principles of fiscal federalism” in order to eliminate some loopholes of traditional principles of fiscal federalism. Through the summary and analysis of current literature on China's fiscal system from fiscal federalism perspectives, this paper concludes that compared to traditional principles of fiscal federalism, the Chinese fiscal system is a kind of "quasi-fiscal federalism." China needs to adopt “modified principles of fiscal federalism” or even “perfect principles of fiscal federalism” to regulate fiscal competition within the governmental system, "principles of market preserving federalism” to govern economic competition among local governments, and the “principle of competitive political federalism” to avoid fiscal centralization.

Keywords: fiscal federalism, local government competition, market preserving federalism, fiscal decentralization.

JEL Classifications：H11 H20

5．Title：Institutional Change，Government Behavior and Space Economic Agglomeration：Based on Hall and Jones's "social infrastructure" of the CPI spatial model

Author(s):Yanbing WEN Xukun ZHANG

Abstract：In this paper, Baldwin and Martin (2003) "C-P Model" and Baldwin et al. (2003,2006) Footloose Capital Model (F-C model) are combined to establish a two-region expansion "C-P-I space model", the difference among three models is that the new model emphasizes the effect of institutional changes and government behaviors‘ "social infrastructure" (Hall and Jones, 1999) in the agglomeration process (Agglomeration), which ignored by the new economic geography theory and also avoid the Assumption of the limitations of homogeneity of the system and enterprise. Through analyzing the evolution path of regional center - periphery structure we get the following results: Firstly, institutional changes and the government behaviors play an important role in economic concentration (diffusion), which in the form of external cost in the space cluster model. Secondly, regarding to the influence of the two elements to non-balanced development of regional economy, it’s mainly reflected in the change of social infrastructure price. Thirdly, the two elements also impact the black hole conditions of concentration and diffusion on black-hole location by Baldwin (2002). Fourthly, institutional changes and government behaviors show penetration effect obviously.

Keywords：Institutional Changes；social infrastructure； Economic Agglomeration

JEL Classification：F15 O38 R12

6．Title：Assessing Fiscal Sustainability and Financing Strategy of Government：Based on the Data from 1978-2009 in China

Author(s):Yu YANG Kunrong SHEN

Abstract:After the financial crisis, due to the implementation of positive fiscal policy and loose monetary policy, fiscal sustainability is renewedly worried about, and financing strategy of Government is rethought profoundly. Based on the data from 1978-2009 in China, both fiscal sustainability and financing strategy of Government are assessed by method of cointegration test. In contrast to much previous research, there are three different points. First, we consider the effect of fiscal system reform on fiscal revenue structure, remove non-tax revenue from fiscal revenue, and assess the influence of on fiscal sustainability. Second, we consider the change of government revenue taken by money issue and assess the influence of seigniorage on fiscal sustainability. Third, based on extended tax-smoothing model, we assess financing strategy of government The empirical results on fiscal sustainability show that Chinese fiscal processes is unsustainable only considering tax revenue, that the fiscal processes is weakly sustainable including non-tax revenue, and that the fiscal processes is strongly sustainable including both non-tax revenue and seignorage. The empirical results on the optimal financing strategy show that china’s government balances the deadweight loss among different ways of financing and that the choice path of both the macro tax rate and the inflation rate are all optimal although tax rate is not optimal. This conclusion is of great significance for how to improve China's fiscal sustainability in post-Crisis era.

Key Words:fiscal sustainabilily; tax revenue; non-tax revenue; seigniorage; financing strategy

JEL Classifications：E62

7．Title：Inhibition and Convergence: A New Explanation on Country Competition

Author(s):Kai DU Qin ZHOU Hong Wan

Abstract:We incorporate country competition into economic growth, and we views technology as competition mode but not only factor. Convergence will bring threaten to North so that North has the incentive to inhibit South’s convergence. However, North could not continuously inhibit South unless North could achieve the transition of technology innovation system. Afterwards, we give tow typical path: China and Japan. Different from classical theories, we could both explain the success and failure of Japan’s economy. Finally, the contribution of this article is providing a new framework of economic growth.

Key Words:Inhibition; Convergence; Economic Growth; Technology Transition

JEL Classifications: O11

8．Title：A Law and Economic Analysis of Accidents of Thrown Objects from High-rise Buildings: On Article 87 of Tort Liability Law

Author(s):Weiqiang HU

Abstract:Damage from dropping objects from high-rise buildings is a perplexing problem for both legal scholars and legal practitioners at current. Based on the positive analysis, this paper starts with the theory of social costs of accidents and compares the changes of constituents of social costs under different liability rules. Then, the concept of risk management is introduced and proved to be superior to other two as long as some binding conditions are met. At end, some policy recommendations are put forward.

Key Words:Damage from dropping objects; the social costs of accidents; risk management

JEL Classifications：K13

9．Title：On the Fallacies in Alchian’s Classical Paper “Uncertainty, Evolution and Economic Theory”

Author(s):Kuohsing LEI

Abstract: Alchian's classical paper "Uncertainty, evolution and economic theory" still dominates our understanding on some key terms such as "convention", "imitation" and etc. This study finds that there are three major fallacies in the paper: treating a low-risk model as a genaral uncertain model, a Gambler's Fallacy on regarding convention as valuable and the non-consistent hypothesis. Such indicates that its deduction from uncertain to individual imitate behavior is wrong. And so, this paper presents several suggestions on correctly understanding on convention under uncertainty.

Keywords: Alchian; uncertain; convention; fallacy

JEL Classifications: B52, B25, D01

10．Title：The Study on the Survival of the Minority Language from the Economic Methods

Author(s):Jian SU

[Abstract] The paper uses the method of economics to compare and analyzes the survival theory of the minority language, Furthermore, we deep and develop model to some degree. The followings are concluded: (1) Q value model, Lazear model and Church model think the convergence of language , so the minority language is impossible to be protected; (2) We make the Church model explain that because of the high cost to learn majority language, the minority language perishes for quite a long time；(3) Grin model which is based on the exogenous hypothesis of necessary protection of the minority language explains it possible to protect the minority language. Changing the language attitude to protect the minority language is beneficial.

[Keywords]common language minority language Q-value language protection

JEL Classifications: B52

11.Title：The Local Governments’ Public Expenditure performance’s Evaluationof Dealing with Public Riskand Influence Factors in China——Based on theEmpiricalAnalysis of DEA - Tobit Model

Author(s):Yu QI Xiaoli CHEN Dan TIAN

Abstract:This paper applies DEA model of secondary relative efficiency to measure provincial government’s public expenditure performance of dealing with public risk，find that ,compared with 2006，provincial government’s public expenditure performance of dealing with public risk is rising and improvement path in 2007, Technical efficiency is in a higher level；management efficiency of most provinces which realize technological efficiency is lower, Unrealized technical efficiency, those provinces’ the management efficiency of the provinces get bigger promotion,this kind of situation is with the distribution of reference benefits and current efficiency；besides the GuangDong and LiaoNing, the overall efficiency rankings of the Midwest is before relatively; the comprehensive efficiency gaps between the provinces is litter, and each province comprehensive efficiency are more than 50%.The tobit model regression results show that, Economic environment and social environment is the main environment factors affecting the local government to the public financial expenditure performance, that local financial support increase don’t raise or improve the ability of local government to deal wit public risk. Based on this, this articles will propose the advices of improving the public financial expenditure performance of local government to deal with the public risk from the four respect.

Key words:local government public risk influence factors dea-tobit model

JEL Classifications：H53