Information Technology And Economic Growth In China

With the rapid development of information technology in 1970 s,it has been sweeping the globe with lightning speed,triggered an ?Information Technology Revolution? around the world.Different from ?The First Industrial Revolution? marked by the steam engine and ?The Second Industrial Revolution? marked by the power,The Information Technology Revolution did not produce a direct change of material form of energy conversion;instead it has a huge impact on information conversion form.Economists expect to find new sources of productivity from the Information Technology Revolution,but the answer is both complex and uncertain.Although China's computer industry started late,its development speed and scale has maintained a strong momentum.Meanwhile,the Chinese government has always put the development of information technology at a strategic height.From the perspectives of China's development process,promoting the development of information technology and information industry is not only an irresistible trend of the times,but also the inevitable choice of China's economic transformation and upgrading.On the one hand,the development of China relies heavily on cheap raw materials and low labor cost advantage in the past,but now it faces the constraints from population resources and environment.On the other hand,China has entered a ?New Normal? which means economic slowdown,serious overcapacity,and traditional industries facing more difficulties,so the economic growth must turn to new mode,that is to say growth driven by innovation,not by investment and material elements.In this context,the information technology becomes an important starting point for the implementation of ?supply-side structural reform? and ?innovation-driven development strategy? in China,because of information technology's advantages,such as extensive industry penetration,active innovation,and strong economic driving power.Nowadays,the information technology has been a kinetic energy source of economic growth and an important means of improving efficiency.Based on the important role of information technology,this paper proposed a theoretical framework to analyze the relationship between economic growth and information technology from the perspective of the effect decomposition for the first time.That is to say,the information technology affects economic growth mainly through three channels,direct effect,the investment effect and the spillover effects.The spillover effect can be divided into four categories,innovation,organizational change,optimize the industrial structure and consumer surplus.Under the guidance of this framework,this research tries to find new sources of productivity for Chinese economy's development through the detailed analysis,and provides a theoretical basis and policy recommendations for the ?supply-side structural reform? and ?innovation-driven development strategy?.This study focuses on the following issues: How does information technology play its role in China's national economic growth? What contribution does the information technology make to China's economic growth? How does the information technology promote the optimization and upgrading of industrial structure and the enhancement of innovation capability by its diffusion and penetration? What is the mechanism and path of information technology to promote optimization and upgrading of industrial structure and enhance innovation capability? The purpose of this study includes following issues:(1)Explore the basic role of information technology in the process of China's economic growth.(2)Analyze the direct effect and spillover effect of information technology on economic growth based on the perspective of utility decomposition.(3)Clarify the mechanism and influence of China's information technology development on the optimization and upgrading of industrial structure and innovation capability.In order to achieve the above objectives,this paper adopts the combining method of theoretical research and empirical analysis,focusing on empirical analysis.In the theoretical analysis,this paper reviews the theory of economic growth and theory of information–economy,summarizes the mechanism of information technology affecting economic growth,and develops a theory research framework of the information technology and economic growth.In empirical research,the empirical methods used in this paper include:(1)Endogenous economic growth model which includes information technology is used in the empirical analysis of the contribution of information technology to China's economic growth.(2)The input-output method is used to analyze the industrial relevancy,industrial spread,industrial nature and economic structure of the information industry.(3)The mediating effect model is used to test the effect of information technology on optimization and upgrading of industrial structure and innovation capability for the first time.The full text is divided into eight chapters,among which the fourth,the fifth or sixth and the seventh chapters are the main chapters of this paper,which correspond to the total effect,direct effect and spillover effect of information technology on economy.Based on the theoretical and empirical analysis,this paper reaches the following important research results:(1)information technology has become a new momentum of China's economic growth.The empirical research shows that the output elasticity of information technology increased from 0.0568 to 0.6677 in the 2008 financial crisis,which means that information technology has made the highest contribution to economic growth since then.In fact,information technology plays a supporting and leading role in the financial crisis,becoming a new source of economic growth.(2)This paper provides evidence for the phenomenon of digital divide.The research shows that the region with higher degree of information technology more than 0.18 percentage to the GDP.?Information rich areas" benefit more from the development of information technology than "information poverty areas".Therefore,under the same circumstance,information technology will pull the gap of economic development further between these areas.(3)The pulling function of the information industry to other industries ranks the first in all industries;the promoting function of the information industry ranks the fifth.So information industry is the most important pillar industry and the leading industry in our country.Judging from the industry's nature,the information manufacturing industry belongs to the intermediate product industry,and the information service industry belongs to the final demand industry.Therefore,in the formulation of industrial policy should be different.(4)Information technology has a positive effect on the optimization and upgrading of industrial structure through a lot of methods,such as boosting new consumption,enhancing the innovation ability of enterprises,and accelerating the accumulation of human capital.Information technology has a positive effect on innovation capability through many methods,such as promoting the reengineering of enterprise management process and production process,and skill biased technological progress effect.(5)The inefficiency of the evolution of industrial structure hinders the spillover effect of information technology.At the present,the Chinese labor market did not achieve effective optimal allocation of resources,resulting in the inefficient development of the third industry,thus weakening the overall economic efficiency,which is not conducive to play the positive role of information technology.The results of this study revealed that the information technology plays a positive role in promoting the economic growth of our country.This paper also points out that the mechanism that information technology plays on the economic growth,especially find some factor that restricts the economic effect of information technology.These results provide a theoretical basis for the implementation of the supply-side structural reform and innovation driven policy.Finally,the paper puts forward some policy suggestions,in order to make full use of information technology to serve China's economic growth,which is also the significance of this study.