Investment And Economic Growth In Western China Highway Construction Research

During the10-years Western Development, west region of China has achieved significant improvement in various areas, especially in the field of fundamental construction of transportation. The increment of national investment on road construction has promoted the development of regional road at a high speed. However, large gap between the west and east region does still exist obviously. The particular geographical position of west region actually determines the importance of road construction in the whole transportation system, which will make a great contribution to the regional economics. This conclusion on the other hand throws another question that whether the increment of national investment on the road construction of west region can actually stimulate the regional economic growth.Based on the general result of investment-economic development model, this paper studies the road construction scenario of west region with the aid of Granger causality test, and finally proves that a long-term and stable equilibrium relation does exist there between investment of road construction and economic growth of west region area. Compared to the national average level of country, this paper also makes an empirical significance analysis of the above-mentioned relationship using the notable production function method. At the end of this paper, some suggestions, which come from the successful experience of other countries, have been provided for the further development of road construction of west region.The main conclusions of this paper include the following sections:(1) A long-term and stable relationship does exist between national investment of road construction and regional economic growth.(2) The capital investment of road construction plays crucial role in the economic growth, correspondingly to the regional economy expansion. Relative empirical study shows that the coefficient of elasticity between investment on road construction and regional economic growth is equal to0.038.(3) By comparison of national average level, this paper finds that the economic contribution due to the investment of road construction in the West is far less than the economic contribution due the same investment in the East. The investment gap between west region and national average level still exist significantly.(4) Under the constraint of the limited funds, empirical study also indicates that the economic benefit coming from the investment on road construction is more remarkable than the investment on the other infrastructure constructions.