The Economic Growth Effect Of Infrastructure Investment In China

Due to the consecutive years of active fiscal policy in China since 1998,infrastructure investment is increasing rapidly,which has forcefully promoted economic growth in China.In recent years,the government has adopted the "steady growth"economic measures,and continue to increase infrastructure investment in China,because the downward pressure on economic growth in China is increasing.A large amount of infrastructure investment plays a significant role in economic growth.However,some scholars think that the effect of promoting economic growth of infrastructure investment will continue to decline with the expansion of the scale of infrastructure investment according to the "law of diminishing marginal returns of capital".Increase of infrastructure investment will lead to "crowding-out effect" upon other types of investment in the premise of limited financing resources,and inhibit the economic growth of China.Then,what is the economic growth effect of infrastructure investment in China?China is vast in territory,in which infrastructure investment presents obvious regional characteristics,and infrastructure investment are not balanced between the eastern,central and western regions,in addition,there is significant differences between different industries of infrastructure investment,so the differences of infrastructure investment between these regions and the industries will also have different effects on economic growth in China.However,most scholars take infrastructure investment as a whole to analyse its effect on economic growth at present,which is lack of pertinence,so it is necessary for the economic growth effect of infrastructure investment at regional level and industry level in China.In view of the current situation of the infrastructure investment in China and the research divergence and defects,this paper will answer some questions:how is the development of the situation of the infrastructure investment at regional level and industry level in China,and what is the difference?What is the mechanism of the action of infrastructure investment on economic growth?What is the relationship between the scale of infrastructure investment and economic growth in China?What is the economic growth effect of infrastructure investment at the national level,regional level and industry level?The economic growth effect of infrastructure investment,both in the theoretical and empirical aspects,has received extensive attention of scholars,which is of important theoretical and practical significance for Chinese economic growth,especially in the background in the government continue to increase infrastructure investment in China.Theoretical analysis and summary analysis,and some empirical analysis such as comparative analysis,econometric analysis are used in this paper to analyse the economic growth effect of infrastructure investment in China systematically.This paper consists of 8 chapters,with the exception of the first chapter(the introduction),the second,third chapter is the analysis basis of this paper,the fourth,fifth,sixth and the seventh chapter is the theoretical analysis and empirical analysis of the economic growth effect of infrastructure investment in China,the eighth chapter is the conclusion and policy suggestions,such as the following:Chapter 1 is introduction.This part presents the paper's research background,significance,research ideas and contents,research methods and main innovations.Chapter 2 is theoretical basis and literature review.Firstly this chapter defines the meaning and characteristics of infrastructure,secondly presents the relevant economic theory,and finally summarizes and evaluates the relevant existing literature.Chapter 3 is the current situation of infrastructure investment in China.The purpose of this part is to present the basic facts of the development of infrastructure investment in China from 1993 to 2015 at national,regional and industrial levels.The scale of infrastructure investment presents a trend of rapid growth from the perspective of infrastructure investment flow at national level,and the eastern region has been the largest scale of infrastructure investment at regional level,but the growth rate of infrastructure investment in the western region is the fastest.Average annual growth rate of the infrastructure investment of "water conservancy and environmental protection" industry is the fastest at industrial level,and the infrastructure investment of "information" industry takes second place,then "transportation" industry,the growth rate of "energy" industry is the slowest.The stock of infrastructure in China has not only increased rapidly in quantity during the period,but also made great progress in quality from the perspective of infrastructure investment stock(physical form),.Chapter 4 is the mechanism of the action of infrastructure investment on economic growth.The infrastructure can be used as a production factor in the production process,which has a direct effect on economic growth,furthermore,infrastructure investment has an indirect effect on economic growth through the "multiplier effect",with the expansion of the scale of the stock of infrastructure,and infrastructure investment has an indirect effect on economic growth through the spillover effect.This part is the theoretical basis of this paper,and provides the theoretical basis for the empirical analysis of the economic growth effect of infrastructure investment.Chapter 5 is the scale of China's infrastructure investment and economic growth.This part analyzes the relationship of infrastructure investment scale and economic growth through theoretical analysis and empirical analysis.Firstly,the theoretical model shows that the relationship between the two presents an "inverted U" curve change,there is an optimal scale of infrastructure investment at the premise of "maximization of economic growth rate".Secondly,using the provincial panel data in China from 1993 to 2015,an empirical analysis on the scale of infrastructure investment and economic growth,the empirical results show that both at national level and regional level,the scale of infrastructure investment and economic growth presents an "inverted U" curve relationship,infrastructure investment,there is an optimal scale of infrastructure investment in the majority of provinces or cities in China,and the scale of investment in these areas is not more than the optimal scale,in addition,the empirical analysis also prove that the degree of opening-up,the scale of government expenditure,the level of industrialization and industrial upgrading have effects on economic growth in our country.Chapter 6 is the empirical analysis of the economic growth effect of China's infrastructure investment from regions.Firstly through the time series data from 2003 to 2015.this part analyses the role of infrastructure investment(flow form)driving economic growth in China during the period,and the result shows economic infrastructure investment has positive stimulating effect on GDP growth in our country in most years.Secondly,this part analyses developing trend of infrastructure investment output ratio(infrastructure investment stock/GDP)in China from the perspective of time series,and finds that infrastructure investment output ratio in China is in the rising period,especially the infrastructure investment output ratio in western region is the highest,which easily leads to the decline of return on infrastructure investment.Finally,this part analyses the economic growth effect of the national and regional infrastructure investment from the perspective of infrastructure investment stock.The results show that infrastructure investment plays a significant role in promoting economic growth at national level.But there are significant differences in the economic growth effect of infrastructure investment between the eastern,central and western regions.Chapter 7 is the empirical analysis of the economic growth effect of China's infrastructure investment from industries.This part is supplemented and refined from the empirical analysis of chapter 6 at industrial level.Firstly,this part analyses the role of economic infrastructure investment(flow form)from industries driving economic growth in China through the time series data from 2003 to 2015,and the result shows economic infrastructure investment from industries has played a positive role in boosting GDP growth in our country.Secondly,this part analyses developing trend of infrastructure investment output ratio(infrastructure investment stock/GDP)from industries in China from the perspective of time series,and finds that the economic infrastructure investment output ratio of stock(infrastructure investment stock/GDP)from most of the industries presents a rapid upward trend.Finally,this part analyses the economic growth effect of infrastructure investment from industries from the perspective of infrastructure investment stock.The empirical results show that infrastructure from industries have played a positive role in promoting economic growth at the national level,but there are obvious difference between the output elasticity of industries,and the output elasticity of industrial level between eastern,central and western regions are very different.Chapter 8 is conclusions,policy suggestions and future research directions.The main conclusions of the theoretical and empirical analysis of this paper are summarized,and this part gives some policy suggestions correspondingly based on these conclusions,finally the future research directions are proposed for the deficiencies of this paper.The innovation of this paper is mainly reflected in the following points:Firstly,a multidimensional comprehensive analysis framework for infrastructure investment promoting economic growth is built,that is,infrastructure investment has an indirect effect on economic growth through the multiplier effect,infrastructure infrastructure can be used as a production factor which has a direct effect on economic growth,and infrastructure investment has an indirect effect on economic growth through the spillover effectSecondly,this paper empirically analyses the economic growth effect of China's infrastructure investment from regions and industries on the base of arguing the optimal scale of infrastructure investment,which refines and deepens the understanding of the relationship between infrastructure investment and economic growth in China,and provides a basis for the formulation of related regional and industrial policies.Thirdly,this paper profoundly analyses the mechanism of infrastructure investment in promoting economic growth from two angles of flow and stock,and comprehensively analyzes the short-term and long-term effects of infrastructure investment on economic growth..