Economic Agglomeration Effect Of Transportation Infrastructure

Economic agglomeration is a long-existing economic phenomenon which intensifies in many regions. Economic agglomeration controls the economic map in current world, which can be reflected from the core-periphery structure of the north and south economy dichotomy to the formation of industrial belt in Europe and Eastern Asia which leads global economy, from the emergence of the world famous international metropolis group like New York and Japan to the remarkable agglomeration difference in the eastern, western and central part in China. Transportation infrastructure, as a traditional and universally recognized factor that may affect economic agglomeration, plays its due role. However, traditional research on the effect of transportation infrastructure on economic system tends to ignore the environment of spatial features, which results in the continual conflict between intensifying economic agglomeration trend and general equilibrium conclusion. New economic geography theory injects spatial factors into economic equilibrium analysis and opens a new era for economic research. However, under the framework of new economic geography theory, theoretical analysis on iceberg cost structure and melting mechanism of transportation infrastructure, especially the theoretical and empirical research of economic agglomeration effect of transportation infrastructure, is far from enough. A good understanding of effect mechanism and effect features of transportation infrastructure in the process of economic agglomeration is theoretically significant in enriching and extending new economic geography theory and strengthening the theoretical links between new economic geography theory and public economics with transportation infrastructure as its main research content.In China, regional economic difference and inequilibrium as well as the intensifying agglomeration trend of economic resources among regions result in an increasingly disadvantaging influence ranging from social and political to economic and environmental aspects. A theoretical understanding of the reasons, mechanism, developmental trend of regional differences as well as the effect of transportation infrastructure may help us to find a scientific and effective solution in practice and realize the goal of "strengthen and consummate inter-regional cooperation mechanism, construct basic facilities and industry properly, eliminate market obstacle and promote the flow of element" claimed in the18th National Congress of the Communist Party of China, which will finally promote the coordinated development in rural and urban areas and build an overall well-off society.Therefore, this thesis, based on new economic geography theory framework, advanced model like LFE model and features of transportation infrastructure for theoretical extension analysis, gains the long-term equilibrium analytical solution of transportation infrastructure economic agglomeration effect. Empirical research methods such as SLM, SDM and threshold panel model are adopted in order to conduct an overall and systematic study of economic agglomeration effect of transportation infrastructure in an attempt to enrich basic theory of economic agglomeration effect of transportation infrastructure and provide scientific decision-making foundation to supply and adjust regional distribution of economic resources by utilizing transportation infrastructureThe thesis consists of6chapters. The first chapter is a brief introduction of the thesis. The second and third chapter, as the basis and prerequisite of empirical study, summarize the theoretical literature and construct new economic geography mathematical model. The fourth and the fifth chapter conduct an empirical study based on theoretical analysis conclusion. The sixth chapter summarizes the thesis conclusion and puts forwards suggestions for realistic policy adoption in China. Specifically speaking:In Chapter3, the author conducts a theoretical analysis concerning the effect of transportation infrastructure on economic agglomeration based on LFE model. Based on the summary of new economic geography theoretical model, together with the deficiency of current theoretical model when calculating transportation infrastructure variables as well as research conclusion analysis obstacle resulted from non-linear model, the author conducts linear free entrepreneur model which covers transportation infrastructure variables and further analyzes the economic agglomeration effect of transportation infrastructure after long-term and short-term balanced mathematical calculation. According to the research conclusion, transportation infrastructure exerts an important influence on local economic resource distribution and economic agglomeration and has spillover effect and threshold effect on economic agglomeration. Besides, issues which need to be further analyzed empirically are put forward.In Chapter4, the author conducts an empirical analysis on economic agglomeration spillover effect of transportation infrastructure in China. Spillover effect is divided into direct spillover effect and related spillover effect through local agglomeration state. Later empirical analysis on the above two spillover effects is conducted through such spatial econometric modeling as SLM and SDM. Transportation infrastructure has direct and relevant spillover effects on economic agglomeration and relevant spillover effect is more powerful than direct spillover effect. Different types of transportation infrastructure exert different effects on economic agglomeration. High-quality road has a remarkable positive influence on economic agglomeration. Railway and secondary road don’t have a remarkable influence on local economic agglomeration. Low-quality road has a remarkable negative effect on economic agglomeration.In Chapter5, the author conducts an empirical analysis on threshold effect of transportation infrastructure on economic agglomeration in China. Based on theoretical model conclusion and the current situation in China, the author reviews the non-linear features of transportation infrastructure and economic agglomeration in China. Later empirical analysis of provincial panel data in China is conducted via the use of threshold panel model. According to the research result, transportation infrastructure exerts a remarkable threshold effect on economic agglomeration. Threshold effect of transportation infrastructure on economic agglomeration varies from region to region and extends in a reverted U shape. From the perspective of absolute influence, economic agglomeration influence of transportation infrastructure in eastern region is powerful than that in other regions all along although the influence demonstrates a declining trend. Vice versa, the influence of transportation infrastructure in central and western regions demonstrates an obviously strengthening trend. From the perspective of threshold number and agglomeration effect fluctuation which is shown by its markedness, influence of transportation infrastructure in eastern and central region on economic agglomeration demonstrates an obvious multi-phase fluctuation trend while in the western region, transportation infrastructure exerts a comparatively stable influence on economic agglomeration due to the small number of threshold. Besides, attitudes and means towards economic agglomeration vary from government to government and exert a remarkable effect on economic agglomeration.The Sixth Chapter is mainly about the research conclusion and policy orientation. The author systematically summed up the research conclusion of the effect of transportation infrastructure on economic agglomeration and put forward the overall principles of supplying and adjusting economic resource regional distribution via transportation infrastructure based on the current situation of regional development and transportation infrastructure supply in China. Finally, according to the research result, the author analyzed the related policy orientation in practice from the perspective of regional collaborative supply of transportation infrastructure, scale supply of transportation infrastructure, structural supply of product categories as well as the dynamic supply in different economic developmental phases.The creative part in this thesis is as follows:Firstly, the author makes a breakthrough in solving the deficiencies of traditional economic theory in studying transportation infrastructure economic agglomeration without taking spatial features into consideration. Instead, based on the perspective of new economic geography theory and the hypothesis of increasing returns to scale and monopolistic competition market theory, the author introduces transportation infrastructure variables into theoretical model analysis. Besides, the author introduces LFE model for theoretical analysis and the analytic solutions of transportation infrastructure on economic agglomeration effect. Based on the inspection of transportation infrastructure economic agglomeration effect, the author further extends its analysis to inter-regional effect of existential spatial features while taking its effect on local economic agglomeration state into consideration. It is claimed that transportation infrastructure exerts spillover effect and threshold effect on economic agglomeration.Secondly, the flow and agglomeration of economic resources is the international process of various regions in the neighborhood. It is hard for traditional econometrics to solve spatial autocorrelation issues of empirical data. Regional space autocorrelation features of transportation infrastructure and economic agglomeration are demonstrated by employing econometrics model in the process of empirical study SLM and SDM are adopted respectively in order to ensure the accuracy of empirical data conclusion. As for the possible non-linear features of empirical model, threshold panel estimation is adopted to confirm the existence of spillover effect and threshold effect of provincial transportation infrastructure economic agglomeration in China.Thirdly, through the analysis of SLM and SDM, the author analyzes the spillover mechanism from direct spillover and related spillover and finds that related spillover is powerful than direct spillover. Under the circumstances of spillover effect, product categories of transportation infrastructure exerts different effects on economic agglomeration. Through the inspection of non-linear features of economic agglomeration of transportation infrastructure by utilizing threshold panel, it is found that in different regions, the improvement of transportation infrastructure may affect the degree of economic agglomeration which extends in a reverted U shape. It is finally proposed that collaborative supply, scale supply, structural supply and dynamic supply should be adopted respectively based on the differences in spillover effect, threshold effect, product categories as well as dynamic economic environment distribution.