| The economy of Lao People’s Democratic Republic has made significant achievements since the reform and opening-up; and had been one of the fastest growing economies in national economy, also the economy is in the new period of expansion. Since the latter half of2006, the fixed asset investment has fell from the peak because of the influence of macro-economic control. Fixed assets investment has played an important role in propelling regional economic growth; however, there are still some problems in investment of Lao People’s Democratic Republic. Therefore, it is need to mar a deep study on the effects caused by fixed asset invest in Lao People’s Democratic Republic.This paper analyzes the effect of fixed assets investment in the economic growth from both theoretical and empirical perspectives. Firstly, the paper analyzes and summarizes the theory and research that are related to investment and economy growth, which can make theoretic foundation. Secondly, the paper analyses the gross of fixed assets investment and the structure of investment on the basis of macro statistics. The empirical analysis contains Co-integrate Regression and granger Causality Test and Error correction model, which are used to analyze the effect of fixed assets investment in the economic growth.The results show that:1. Cointegration analysis showed that there is a long-term stable equilibrium existed in the fixed assets investment of Laos and economic growth, for the growth of the economic it will play a pull function in fixed assets investment, when the fixed assets investment increased by1%,Laos’s gross domestic product will be increased by0.8380%, in recent years,the growth of investment in Laos is the main driving force. in the short term, Error correction model shows that fixed assets investment has a obvious effect to the growth of economic. when fixed assets investment changed1%, will cause GDP changed0.040%in a same protection:the dynamic balance mechanism existed in the two variables, when short-term volatility deviating from the long-term equilibrium, Error correction term will plays a obvious converging action, For the last year’s unbalanced error,it will make reverse revision for this year’s gross domestic product at the ratio of 0.0016%2. From Granger causality test we can get that, At present, a two-way causality existed in Laos fixed assets investment and CDP. The changes of fixed assets investment caused GDP changes; meanwhile, the changes of GDP also caused the changes of fixed assets investment. It is illustrated that economic growth of Laos improved a material foundation for the form of capital and Investment incremental.For the increased investment, Economic growth is the premise and foundation. Or "accelerate principle".Economic growth will improve investment growth speediness.meanwhile, For the long time Capital accumulation, it is appearance that Fixed assets investment has a obvious effect to the growth of the economic.3. C-d production function analysis results appearance that fixed capital amount will play a important affection to the per GDP. The contribution of investment to economic growth is63.67%.we can get that, Since the reform and opening,Laos capital investment increased by1%, can make the growth of economic increased by0.10. drive the growth of economic increased by0.61%, accounting for63.67%the growth of economic, the invest of the labor increased by1%, can make the economic growth0.69, promoting the growth of economic increased61.68%, accounting for20.14%the growth of the economic.16.19%of economic growth factors derive from total factor productivity. It is contains system innovation, the industrial structure adjustment, economy of scale, the allocation of resources.policy and law, and so on. From the above data,we can see that Laos economic growth mainly depends on investment.4. From the positive analysis of the Industry structure to the economic scale and elements efficiency.we can get that, in market economy of the Laos,... |
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