Budget Target Management and Credit Structure Allocation within the Local Debt Network

Speaker：Feng Chen, Professor, Xi'an Jiao Tong University

Host：Liu Guanchun, Professor, Lingnan College

Time and Date：10:30, May 25, 2026 (Monday)

Venue：Wang Dao Han Conference Room (101), Lingnan Hall

Language：Chinese

Abstract：

Within the unified budget framework, target management serves as a crucial institutional tool for macro governance and exerts a systemic impact on local debt operations and the transmission of financial risks. This study constructs a financing platform group network to examine the influence of budget target management on their credit structure. The findings reveal that following the implementation of the new Budget Law, an implicit restructuring occurred within the groups, characterized by reduced financing for parent companies and increased financing for subsidiaries—a pattern reflecting debt decentralization. This structural shift also triggers credit redistribution effects. While the contraction in parent company credit partially mitigates bank risks, the credit expansion by subsidiaries exacerbates the accumulation of systemic risks, demonstrating the transmission of fiscal risks to financial risks through financing platforms.

Profile:

Feng Chen is a professor and doctoral supervisor at the School of Economics and Finance, Xi'an Jiaotong University. He has been selected for the National High-Level Young Talent Program and the Shaanxi Provincial High-Level Young Talent Program, with research interests in public economics and development economics. He has published over 60 papers in journals such as Economic Research, Management World, Economics (Quarterly), World Economy, as well as Journal of Economic Behavior & Organization, Journal of Economic Dynamics & Control, and Journal of Corporate Finance. He has led more than 20 research projects funded by the National Natural Science Foundation of China and other commissioned initiatives, with over 30 policy advisory reports receiving endorsements from central and provincial/ministerial-level leaders or being adopted by relevant departments. His accolades include the Huangda-Mundell Economics Award, the Special Prize for Outstanding Research Achievements from China Think Tanks, the First and Second Prizes for Outstanding Achievements in Philosophy and Social Sciences of Shaanxi Province, and the Second Prize for Outstanding Achievements in Philosophy and Social Sciences of Shanghai Municipality, among other honors in both research and teaching.