Research On The Relationship Between Chinese Natural Resources Endowment And Economic Development,with The Discussing Theory Of “Resource Curse”

Since the emergence of economics, the driving force of economic growth has been one of its core issues. Factors from natural resources, physical capital, and labor force at the beginning to human capital, technical progress, and institutional innovation later are all recognized widely by scholars as main driving elements of economy. Though it is not the main factor of economic growth in the classical economic growth model, natural resources had been always considered as the material basis for economic growth. As the theory of “resource curse” is put forward, numerous scholars have proved that rich natural resources don’t only promote economic growth but also become the handicap of economic development through empirical researches on the relationship between natural resource endowment and economic growth of different countries. In the academic world, many scholars go along with “resource curse”, but the voice of disagreement never stops, and different scholars reach entirely different conclusions through analyses from different perspectives and different selections of data and variables. After sorting the relationships between resource endowment and economic development proposed in China and foreign countries, the author of this paper finds that among the studies on the relationship between the two in China, scholars mostly replace economic development with economic growth for empirical research and largely reach the conclusion of “resource curse”; however, there still are some scholars reach the opposite conclusion.The study herein aims to search for a more accurate relationship between economic development and natural resource endowment in China. For this reason, the results of development are measured in a more comprehensive way based on the status of economic development that is represented by the people’s livelihood and development indices issued by the State Statistics Bureau since 2000, and the relationship between resource endowment and economic development in China is discussed based on the empirical test of panel data regression by using natural resource exploitation of 29 provinces and cities(excluding Tibet and Hainan due to serious data missing) of China from 2000 to 2013 as the proxy indicator of natural resource endowment. After reaching the conclusion of the positive correlation between the two, the author further studies the relationship between natural resource exploitation and economic growth and through panel data regression, reaches the conclusion that there is negative correlation and “resource curse” existing between them. Comparative analysis is conducted in the paper on the different effects of resource exploitation on economic development and growth.In Chapter V, the author changes the proxy indicator of natural resource endowment and replaces natural resource exploitation with natural resource reserve to observe the relationship between natural resource and economic development again by means of regression, which reaches the conclusion that there is a negative correlation between natural resource reserve and economic development. To specifically study the impacts of various natural resources on economic development, regression is conducted on the exploitation of different natural resources, i.e., coal, oil, and natural gas, and the economic development indicators at the end of the chapter. The conclusion is that the exploitation of coal, oil, and natural gas respectively plays a role in promoting economic development and the promoting effect of coal exploitation is more significant.Following the discussion about the relationship between natural resource endowment and economic development, the paper strives to find out the conduction mechanism of resource endowment with respect to economic development. Six conduction variables, namely, investment in human capital, institution quality, investment in physical capital, manufacturing development level, opening-up degree, and technical innovation level, are selected on the basis of the research results of predecessors to determine natural resource endowment’s direct effect on economic development and its indirect effect on economic development via conduction variables by means of regression. The study reveals that the positive impact of natural resource exploitation on the economic development of China is chiefly manifested by the direct effect of physical capital investment on economic development and natural resource exploitation investment. The investment in physical capital has always been the main driver of economic growth of China for a long time, and in addition, natural resource exploitation itself also plays a very obvious role in promoting economic development. Natural resource exploitation has a relatively significant negative correlation with and a relatively great impact on human capital level and technical innovation level, respectively, indicating that natural resource exploitation will consume the investment of society originally in human capital and technical innovation. This is a problem needing special attention during resource exploitation. Furthermore, natural resource exploitation also imposes certain negative effect on the opening-up degree.Based on the aforesaid conclusion, the paper starts with analysis on the reason for the inconsistency between the conclusion and “resource curse” and finally puts forward feasible policy suggestions for the natural resource exploitation and utilization of China from institutional, industrial, and regional perspectives.