Has China's Transportation Infrastructure Improved the Efficiency of Enterprise Resource Allocation? Analysis Based on Expressway Construction and Factor Input of Manufacturing Enterprises

Abstract

The transportation infrastructure is widely regarded as an important factor for the improvement of economic performance in developing countries, but its effect mechanism remains controversial. In recent years, people widely argue that the efficiency of resource allocation among enterprises mainly accounts for a large economic performance difference between different nations. To test whether the transport infrastructure actually affects enterprise resource allocation and thereby improves economic performance, this paper uses the data matching industrial enterprises and highway construction in China, and empirically analyzes the impact of Chinese transportation infrastructure on the efficiency of enterprise resource allocation and its effect mechanism. The results show that transportation infrastructure does improve the efficiency of enterprise resource allocation and enterprises which are located in cities with nearer distance from the expressway have a smaller difference between real size and optimal size. Specifically speaking, transportation infrastructure reduces output distortion resulting in both capital and labor input distortion, thereby making real sizes of enterprises closer to the optimal sizes. The analysis based on mediation effect further indicates the factors concerning the effect of expressway on the efficiency of enterprise resource allocation mainly include price markup, industry concentration, and so on, and expressway does not play a significant role in the efficiency of enterprise resource allocation through inventories.