Research Of The Relationship Between Urbanization And Growth

Since reforming and opening, The southeast China of Zhejiang province acquires world-shaking achievement, makes further progress in economic growth, social progress, urbanization development and so on. Zhejiang undergoes the course of society transformation from agriculture to industry, and labor force transformation from countryside to urban areas. From 1978 to 2005, the urbanization level rose from 11.92 percent to 27.53 percent. There is no doubt that such large-scale population transformation would produce tremendous and far-reaching influence on economic growth. The urbanization development is a quite complex and enormous social economical dynamic system. as the development of economy, the urbanization development load in China changed its style. It has been recognized congruously by the academe that the urbanization development would accelerate the economic growth. Nevertheless, the problem is still in dire need of solving, that is, how to measure the effect and influence of urbanization development. This paper tries to do some research from this point of view. We apply modern economic measure instrument, to explain the Relationship between economic growth and urbanization development. Economic growth and urbanization development affect each other .So we via introducing VAR model and impulse function to reflect the effect of the growth on urbanization and urbanization on growth. Economic growth and urbanization development contacts over long period's relationship but not short time periods. Therefore, we make use of panel cointegration to describe the link in this paper. What's more, urbanization development would not accelerate the economic growth all the time according to developed countries' experience. Sometimes it will make economic growth backward, which is called over urbanization .The paper makes use of fixed effects models to measure the urbanization elasticity.Our attention is concentrated on studying how urbanization impacting economic growth and how economic growth impacting urbanization in Zhejiang province via series data and panel data.The article retrospects theoretical workers on urbanization economic growth and the relationship between them. It also defines the urbanization category and economic category. In the second section, the paper introduces the theory and models used detailed in the demonstration stage. In the third section , the article looks over them in Zhejiang province. What's more , the paper analyze the urbanization over Zhejiang province and compare the urbanization of Wenzhou with Zhou Shan. Finally, the paper discuss the meaning of improving the economic growth and urbanization, and gives some suggestion on how to improve urbanization and economic growth.