논문

The main purpose of this study is to obtain empirical evidence of differential
effects of industrial sectors on the local government financial resource
mobilization. At theoretical level, the relationship between industrial activities and
local government financial capacity is well established. However, there is not
much empirical evidence on this relationship. Effect of industrial activities on
local government finance was analysed both revenue and expenditure sides.

Among manufacturing industries, intermediate goods manufacturing sector and
capital goods manufacturing sector have a positive impact on local tax revenue
increase, while consumer goods manufacturing sector has negative impact. This
result suggests that not all the manufacturing industries contribute to increase in
local tax revenue. In the service sector, producer services influence positively to
raise the local tax revenue. One interesting finding is that service sector is
relatively more important than manufacturing sector in promoting local revenue.
That means service sector need to be considered as a source of local revenue.