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Good governance is an important guarantee for the sustainable development of regional economy. Since the Reform and Opening-up, China’s local economic development has made remarkable achievements, which has aroused the concern of the academic community. The main contents of China’s local governance quality assessment include: government capacity, marketization, and rule of law, which means a new multidimensional perspective on local governance assessment: “power allocation + governance capacity + rule of law”. This paper designs the index system of China’s local governance assessment based on literature investigation and coefficient of variation, which utilizes two approaches: qualitative analysis and quantitative analysis. Furthermore, the investigation analyzes the panel data (2001–2014) of provincial regions in China by utilizing global factor analysis and weighted average. The results indicate that the improvements in government capacity, marketization, and rule of law were higher in the majority of provinces studied in central and western China between 2001 and 2014, while they were lower in most of provinces researched in northeastern China in the same period, which resulted from policy differences. In 2014, government capacity, marketization, and rule of law were higher in the majority of provinces investigated in eastern China, while they were lower in most of provinces surveyed in the rest of China, which was due to the differences in policies support, resources management, absolute geographical location, per capita GDP, and market economy. In order to improve local governance quality and achieve sustainable economic growth, it is very important to establish local governance structure as “effective government + efficient market”, China should pay more attention to weak aspects of local governance and some provincial regions in western, central and northeastern China.

Assessment system and empirical study on China’s local governance quality