Infrastructure Investment and Regional Economic Growth: Evidence from Yangtze River Economic Zone

Jinrui Zhang,Junzhuo Xu,Jie Wang,Ruilian Zhang,Guoqing Shi

doi:10.3390/land10030320

Jinrui Zhang, Junzhuo Xu + Show 3 more

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https://doi.org/10.3390/land10030320

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Journal: Land	Publication Date: Mar 19, 2021
Citations: 8	License type: CC BY 4.0

Affiliation: Hohai University, University of Queensland

Abstract

To better understand the impacts of infrastructure investment on economic growth and, we used Cobb-Douglas production function model to develop the stock of public infrastructure capital into the economic growth model. It applies spatial panel data model effect analysis to statistical data of the Yangtze River Economic Zone with 131 cities from 2003 to 2016 and investigates the relationship between different types of public infrastructure capital stock and regional economic growth in different periods. The empirical results show that (1) the economic growth of the cities in the Yangtze River Economic Zone has characteristics of significant spatial dependence, the degree and significance of spatial dependence are gradually declining, and the spatial agglomeration of the economic growth in the cities in the region is relatively stable. (2) Different types of public infrastructure capital stock have distinct spatial effects on regional economic growth. The capital stock of energy infrastructure significantly promotes global economic growth. The capital stock of transportation infrastructure significantly stimulates the local economic growth and inhibits the economic growth of the adjacent areas. The capital stock of water-related infrastructure restrains local economic growth and promotes economic growth in adjacent areas. These findings indicate that increasing investment in public infrastructure development in the Yangtze River Economic Zone remains an effective measure to promote regional economic growth. Under the premise of limited resources, taking full account of the effects of various types of investment can promote the mutual benefit of the economies in the region and effectively achieve the strategic objectives for the Yangtze River Economic Zone.

Highlights

Infrastructure development can effectively promote economic growth is an important experience for governments to formulate economic growth policies in the last 100 years [1,2].The international financial crisis in 2008 has had a huge negative impact on the economic growth of all countries in the world
In order to expand domestic demand and stimulate economic growth, the Chinese government launched a “four trillion” public infrastructure investment and construction project, which played an important role in alleviating the impact of the financial crisis
The main objective of this paper is to study the impact of public infrastructure on real GDP and its spillover effect

Summary

Introduction

Infrastructure development can effectively promote economic growth is an important experience for governments to formulate economic growth policies in the last 100 years [1,2]. The international financial crisis in 2008 has had a huge negative impact on the economic growth of all countries in the world. The rising unemployment rate, economic recession, and the reduction of living standards are bothering people all over the world [3]. To this end, in order to expand domestic demand and stimulate economic growth, the Chinese government launched a “four trillion” public infrastructure investment and construction project, which played an important role in alleviating the impact of the financial crisis.

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