The role of infrastructure in China's regional economic growth

Yingying Shi; Shen Guo; Puyang Sun

doi:10.1016/j.asieco.2017.02.004

The role of infrastructure in China's regional economic growth

Yingying Shi^*
, Shen Guo
, Puyang Sun

^*Corresponding author for this work

Research output: Journal Publication › Article › peer-review

105 Citations (Scopus)

Abstract

This study investigates the relationship between infrastructure capital and China's regional economic growth for the period 1990–2013. Four types of infrastructure are considered: electricity generating capacity, roadway, railway, and telecommunications. Using a vector error correction model, we find mixed support across time period and region for the contribution of infrastructure investment to economic development. With regard to road construction in lagging regions in particular, the impact appears to have become negative under a program of ramped up efforts. The results resonate with the theoretical literature on the inverse U-shaped relationship between infrastructure investment and growth which posits a “crowding-out effect” of private capital when infrastructure investment becomes too dominant.

Original language	English
Pages (from-to)	26-41
Number of pages	16
Journal	Journal of Asian Economics
Volume	49
DOIs	https://doi.org/10.1016/j.asieco.2017.02.004
Publication status	Published - 1 Apr 2017
Externally published	Yes

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 8 Decent Work and Economic Growth
SDG 9 Industry, Innovation, and Infrastructure

Free Keywords

Dynamic panel data
Economic growth
Infrastructure
Regional inequality

ASJC Scopus subject areas

Finance
Economics and Econometrics

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10.1016/j.asieco.2017.02.004

Cite this

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title = "The role of infrastructure in China's regional economic growth",

abstract = "This study investigates the relationship between infrastructure capital and China's regional economic growth for the period 1990–2013. Four types of infrastructure are considered: electricity generating capacity, roadway, railway, and telecommunications. Using a vector error correction model, we find mixed support across time period and region for the contribution of infrastructure investment to economic development. With regard to road construction in lagging regions in particular, the impact appears to have become negative under a program of ramped up efforts. The results resonate with the theoretical literature on the inverse U-shaped relationship between infrastructure investment and growth which posits a “crowding-out effect” of private capital when infrastructure investment becomes too dominant.",

keywords = "Dynamic panel data, Economic growth, Infrastructure, Regional inequality",

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AU - Guo, Shen

AU - Sun, Puyang

PY - 2017/4/1

Y1 - 2017/4/1

N2 - This study investigates the relationship between infrastructure capital and China's regional economic growth for the period 1990–2013. Four types of infrastructure are considered: electricity generating capacity, roadway, railway, and telecommunications. Using a vector error correction model, we find mixed support across time period and region for the contribution of infrastructure investment to economic development. With regard to road construction in lagging regions in particular, the impact appears to have become negative under a program of ramped up efforts. The results resonate with the theoretical literature on the inverse U-shaped relationship between infrastructure investment and growth which posits a “crowding-out effect” of private capital when infrastructure investment becomes too dominant.

AB - This study investigates the relationship between infrastructure capital and China's regional economic growth for the period 1990–2013. Four types of infrastructure are considered: electricity generating capacity, roadway, railway, and telecommunications. Using a vector error correction model, we find mixed support across time period and region for the contribution of infrastructure investment to economic development. With regard to road construction in lagging regions in particular, the impact appears to have become negative under a program of ramped up efforts. The results resonate with the theoretical literature on the inverse U-shaped relationship between infrastructure investment and growth which posits a “crowding-out effect” of private capital when infrastructure investment becomes too dominant.

KW - Dynamic panel data

KW - Economic growth

KW - Infrastructure

KW - Regional inequality

UR - https://www.scopus.com/pages/publications/85014515223

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DO - 10.1016/j.asieco.2017.02.004

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SN - 1049-0078

VL - 49

SP - 26

EP - 41

JO - Journal of Asian Economics

JF - Journal of Asian Economics

ER -

The role of infrastructure in China's regional economic growth

Abstract

UN SDGs

Free Keywords

ASJC Scopus subject areas

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