Information Industry And Economic Growth In China

Information industry was born in the 1960s or 1970s, and now it has stepped into high-speed development process. With the rapid information-based process in society, information industry has become a cross-century pillar industry whose prosperity and decline will decide the whole economic trend. Information industry development in our country started later than developing countries, but our government and the society from all walks of life all give full affirmation and support for the important role of information industry in national economy. The report on the Seventeenth Congress of the CPC apposed informationization, industrialization, urbanization, marketization and internationalization together to be the new mission of our economy development, and brought forward to push the amalgamation of informationization and industrialization energetically. At present,each department and each area are putting this spirit into Concrete domain,which are propitious to quicken the step of electron information industry rebuilding traditional industry for industry development creating new huge space.As our government thought much of information industry development and the improvement of economic development level day by day, our electron information corporations above the scale made 5,882,600,000,000 Yuan main business income with the increasing 14.8% compared to the same period in which manufacturing made 5,125,310,000,000 Yuan main business income with the increasing 14.8% compared to the same period. Software industry made 7,572,900,000,000 Yuan main business income with the increasing 29.8% compared to the same period. Industry increase in value (not include software industry) made 1,140,790,000,000 Yuan with the increasing 14.7% compared to the same period. The whole year of 2008 made 2,384,100,000,000 Yuan of the total quantity of post and telecom operation with more increasing 20.7% compared to last year in which the total quantity of post operation made 1,402,000,000,000 Yuan with the increasing 15.5% compared to last year; the total quantity of telecommunication service is 2,244,000,000,000 Yuan with the increasing 21.0%. Our country reduced the bureau-using switchboards 1,560,000 Men, total capacitance is 510,000,000 Men. The number of fixed-line telephone users is 340,810,000. The number of city telephone users is 232,000,000 Yuan, the number of county phone users is 108,810,000. Addition mobile phone users are 93,920,000 reaching 641,230,000 Yuan at the end of the year. The total number of fix phone and mobile phone users is 982,040,000 increasing 69,090,000 Yuan compared with last year. Telephone popular rate reached 74.3 per hundred people. People surfing on Internet reached 300,000,000 Yuan in which people using broad Band reached 270,000,000 Yuan. In addition, considering that electron information industry plays a key role in information industry, we research electron information industry finished the situation of each index.The development of Information technology makes information industry is important for every country's economic growth day by day. First, this paper began with the definition of information industry, and introduced the definition of information industry from inside and outside our country. In addition we summarized papers on the relationship of information and economic growth abroad, and domestic papers on relationship of information technology, information industry and economic growth in which we summarized and introduced developed countries and developing countries'experience, compared with which, papers brought forward policy-type suggestions to China. Papers analyzed developing countries like China and Indian, and got useful information to our country. Last we summarized papers on our information and economic growth.Second, we introduced the theory frame of Solow's economic growth headspring. Then, we make some essential correction to production function model in the framework on economic growth sources, in terms of which calculate the effect of technology information on China's economic growth. As for the style of technology progress, we make the assumption of Hick's neutral technological progress, and use Cobb-Douglas production function. Given that China statistical annual woks in terms of traditional three industries, we have no relevant statistical data on information industry. This paper substitutes the data on electronic and communication equipment manufacturing industry as well as the post communication industry for the data on information industry. All the data, including GDP, fixed asset investment and employment, come from the 1992-2007 annual data obtained from . For considering the nonlinear influential effect of information industry on the economic growth, we use the threshold regression method by Hansen(2000), with the variable as the point of regime switch, and the different regimes are indicated under the fact that whether the threshold variable is bigger than threshold value or not. We use threshold regression method to explore the contribution of information industry on economic growth in China. The result shows that technological progress makes more than 10% contribution to economic growth. Under the regime low economic growth, the contribution degree of technological progress is 15.14%; under the regime of high economic growth, the contribution degree is 18.26%. The contribution of the high growth regime is bigger. Of course, whatever economic regime when the economy is, the contribution of technological progress to the economic growth is relevant big, which implies that information technology represented by the technological progress is very high. Further, when the economic growth is fast, the contribution of information technology is bigger. This implies that the development of technological information would help to increase the economic growth, or when the economic growth is fast, the economic development is useful for the development of information technology.To research the cause and effect relationship of information technology and economic growth, we used Granger causality tests to analyze. Granger causality tests result shows that whatever economic regime when the economy is, the result of Granger causality test indicates that the rate of economic growth and the rate of information industry are Granger causality relation for each other whenever economic is under high or low economic growth state. And Granger causality relation is more remarkable under high economic growth state.This paper provides some empirical evidence. The paper explains there is non-linearity relationship between industry and economic growth, technology improvement contributes bigger to nation economic. Information improvement weighed by technology improvement contributes bigger. And when economic growth rate is higher, information technology contributes bigger.