The Econometric Analysis Of The Relevance Between Automotive Industry And Economic Growth In China

In developed countries automobile industry has always been paid much more attention, it is an high associated with other industries, employment capacity, magnitude of a wide range of industrial and other industry characteristics, and high input, It can fully promote the development of its upstream and downstream industries in order to promote the rapid development of national economy. In some developed countries, it has a great proportion of the automotive industry. The outbreak of the financial crisis, the auto industry is affected hardest. Available business loans are less and less, lack of liquidity and then happened serious business losses. After a significant decline after the end of 2009, auto market environment will be improved, starting a substantial increase in car sales, car market picking up, national economies are gradually warming. So, automobile industry has an important role in economic development. From three perspectives we analysis the relevance of the automotive industry and economic growth.First, from the auto industry's overall we will think about the impact on economic growth. The automobile industry gross output is the most basic and the most important index, which can reflect the overall direction of development of automobile industry. In this paper, In this paper, we use the classical regression model analyzed the auto industry output how to produce the impact on economic growth. We can see that for every 1% increase in automobile production, it will drive the growth of 0.4663% GDP. Therefore, the auto industry is a growth point of economy. Further from the view of car consumption and auto industry investment, auto industry investment point of view, we use error correction model to analyze the auto industry pulling effect on the economy, derived from the results: When the consumption and investment in the automotive industry increased by 1%, it can boost GDP, respectively increase 0.9758% and 0.1970%. Conclusions from the result we can get China's auto industry investment increased year by year, but it's still insufficient, so auto industry investment on economic growth is not significant.Second, utilizing VAR model to analyze the indirect impact on economic growth of automobile industry from the structure within the automobile industry chain, it can find out China auto industry have positive impact on the oil industry and iron and steel industry, the contribution rate is increases gradually to the rubbery trade, crude oil industry, plastics industry and steel products industry and will keep steady on long terms. In a word, the impact on crude oil industry and steel industry of automobile industry is obvious, and crude oil industry and steel industry are leading industries, they have very obvious influence on economic growth. So the conclusion of analysis of this paper basically accords with reality, it further proved the automobile industry drives relevant industries then promotes the economic growth.Third, the secondary industry accounts for a large proportion of in the GDP, while, the automotive industry in the proportion of about 8% in secondary industry. This article using the state space model analyzed the correlation between automobile industry and secondary industry in China. Concluded that exports of auto parts occupies an important position in China's automobile industry, auto parts exports are labor-intensive, low-tech products in the main, as domestic enterprises continue to introduce advanced technology, innovative, there are more and more high-tech export parts. The export expansion will lead to the growth of related industries, Capital markets and labor markets continually re-allocation of resources with export expansion, increase the effectiveness of the overall resources in order to stimulate the economy continues to boom. The role of imports is shown to increase domestic supply, from the long term, increased imports can also indirectly promote economic growth. In short, the import and export auto parts industry in the development of the second significant leading role, in turn, can stimulate economic growth.Fourth, the industrial agglomeration in industrial development plays an important role, it can provide many advantages to the region, enhance the overall competitiveness of regional industries, and promote the rapid development of regional economy. In this paper, we used panel data model to find out the combined effect of China's auto industry on the role in promoting regional economic growth. Transport situation is an important factor affecting concentration ,Yangtze River Delta, Pearl River Delta in the auto industry concentration levels has a significant role in promoting on the regional economic development; in central and southwestern parts, such as in Anhui, Hunan, Hubei, Chongqing demonstrated the impact on regional economic development is relatively weak; in Northeast China and the Beijing-Tianjin area, there are a high concentration level, but they are not significant effect on the economy. This phenomenon is due to transportation forms in the Northeast region are not richer than the Yangtze River Delta and Pearl River Delta region, the initial endowment is bound to promote rapid economic development. Despite there exists so many problems, but Industry agglomeration still play positive effect to the economy, government departments and related enterprises managers could make further efforts to establish a rational industrial policy, and encourage the gradual increase in industrial scale, to achieve regional coordination development, so that they can better relize sustainable economic development.