Analysis On The Economic Effect For The Development Of The Fundamental Industry In The Central China Areas

Since 1980s the focal point of the development strategy of the country's regional economy has been placed in the eastern coastal area. With the increasing enlargement of the regional economy difference, our country proposed to develop western China regions and the Northeast China, during which time the central China areas have not been sufficiently supported by the government. With the constant promotion of the economic system reform, a lot of problems have appeared in the industrial development parting the central China and hence influenced the economic development of the region. This paper, from the angle of the fundamental industrial development of the region, studies and probes into the reason why the economy of the region collapses.This paper first introduces the theoretical foundation of the fundamental industrial development: the theory of balance increasing and the theory of non-equilibrium increasing. After the theory is explained, this paper reviews each historical stages of fundamental industrial development of the central region in Chapter Two, and describes the changes of the national status for the fundamental industries and the contribution of industry to the economic growth. The paper introduces the current situation of the fundamental industrial development of the region and points out the existing problems.In Chapter Three, the paper makes a concrete analysis how the fundamental industries of the region affects the whole country including the eastern areas and the central China areas itself. The paper analyzes the effect on economic development of eastern area including the regional trade that brings interest shift to the east China areas and regional burden of taxation that brings the dual interests to the areas, which proves the central China areas' enormous contribution to the high growth of economy of east China areas. Finally, the paper describes the negative effect to urban economy development of the central regions and the problems existing in the industry at the present stage. In Chapter Four, paper analyzes deeply the factors thatcause the regions industry of middle part declining: the unreasonable relations of the exchange rate and non- balanced development strategy of the country, which has been proved by the paper by analyzing the barrier in the economic system of central regions during the transition period and by comparing the eastern area against central regions in the institutional environment.Analyzing from theoretical perspective and positive research and current situation, the final chapter in the thesis draws the reason why the economy of the central region collapsed: firstly, with the development of the basic industries, the internal effects of the central region to the outside present the inconsistency. Secondly, the fundamental industries of the central region have hindered the development of their urban economy. Meanwhile, the paper proposes the corresponding countermeasure: firstly to offer the related comprehensive policy to support the industrial structure adjustment and revitalize economy of the region; and secondly to transform traditional idea, traditional system and traditional industry.