Determinants of public goods investment in rural communities in mountainous areas of Sichuan Province, China

Abstract

This study aims to investigate two important issues: what are the determinants of public goods investment and what is the government's investment behavior in mountainous areas. The impacts of natural conditions, target, and demand elements on public goods investment are analyzed with statistical method, and the determinants of public goods investment in the areas are obtained by using population-weighted and stepwise regression models with Eviews6.0 software with survey data in 2008 and calculated data based on GIS of 20 typical villages in mountainous regions in Sichuan, China. The results showed: (1) natural conditions are the important determinants of public investment. Mountainous villages with steep slope have relatively high levels of investment; (2) concentration of population and the educational levels of the village leaders also have important impacts on public goods investment; (3) the government is more concerned with public investment resources particularly in areas characterized by fragile ecological environment and poor agricultural output. These results suggest that the current investment strategy helps to reduce disparities in regional development.