China's municipal public infrastructure: Estimating construction levels and investment efficiency using the entropy method and a DEA model

Abstract

As a key component in China's urbanization, urban municipal public infrastructure plays an important role in promoting economic development and improving living standards. Close examination of municipal public infrastructure construction levels and investment efficiency is thus necessary for Chinese decision makers to be able to address issues of sustainable socioeconomic development. This study first established a comprehensive index system for assessing the level of construction of municipal public infrastructure based on the entropy method. Data Envelopment Analysis (DEA) was then used to evaluate the investment efficiency of the municipal public infrastructure of 290 Chinese cities between 2005 and 2014. The empirical results revealed that municipal public infrastructure construction levels increased between 2005 and 2010, then decreased slightly from 2010 to 2014; regional inequalities between levels were found to have increased gradually during the study period. The comprehensive technical efficiency (CTE) levels of Chinese cities were generally low and falling on the whole. There existed considerably differences between the eastern, northeastern, central, and western regions, with most cities in the northeast region maintaining high CTE during the study period, while CTE in the western was relatively low. Furthermore, the relationship between construction levels and input-output efficiency with regard to municipal public infrastructure could be described with recourse to four distinct categories: high construction level and high efficiency, high construction level and low efficiency, low construction level and high efficiency, and low construction level and low efficiency. About half of the cities studied were found to be in the low-low category. The findings of this research can help Chinese policy makers to better understand the performance of municipal public infrastructure and thus implement appropriate measures to guide municipal public infrastructure construction toward sustainable development.