Spatial Evolution, Club Convergence, and Spillover Effects of Local Government Debt Risk: County-Level Evidence From China

County-level government debt risk has become an increasingly important challenge for fiscal sustainability in China, yet its spatiotemporal evolution and cross-regional spillover patterns remain insufficiently understood. Using panel data from 2014 to 2024, this study investigates the spatial evolution, dynamic transitions, and spillover effects of county-level debt risk in China. We construct a broad debt-risk indicator combining explicit debt, implicit debt proxies, and comprehensive fiscal capacity to better capture county-level repayment pressure, and develop a spatial analytical framework integrating the Dagum Gini coefficient, spatial autocorrelation analysis, spatial Markov chain model, and spatial lag model. The results yield three main findings. First, county-level debt risk converges at elevated levels: regional disparities narrow over time, but this convergence is driven by a broad-based rise in debt pressure relative to local fiscal capacity. Second, debt risk displays persistent spatial polarization and club convergence, forming a stable pattern of higher risk in western counties and lower risk in eastern coastal counties, with strong spatial path dependence. Third, debt risk shows significant positive spatial dependence across geographically related regions. Complementary pathway regressions provide evidence consistent with three proposed channels—infrastructure investment competition, land value linkage, and financing credit linkage. This study extends the spatial perspective in the local public debt literature to the county tier, and offers policy-relevant implications for cross-regional monitoring and differentiated risk governance.