Study On The Differencs Of The Fixed Assets Investment On East And West In China

The rapid development trend of China’s economy has been maintained, at the moment the trend of the GDP is growing since 1980s of the 20th century. However, with growing of the GDP in China, the regional appears more and more difference in economic situation. We know that the investment is closely linked with the development of economy, and it is one of an important driving force of the modern economic growth. The fixed assets investment plays a most significant positive role in investment and in promoting the development of the economic growth, at the same time it is also the important factor and affect regional economic disparities. It is necessary condition that researching and comparing the characteristics of the fixed assets investment of different regions to learn and know of economy developing laws of regions, to realize the balanced development among different regions, to promote economy high speed development of the whole national. Because of regions differences in the geographical location, history, cultural and resource-based, which would must exist in something different and differences of the fixed assets investment. Study on differences of the fixed assets investment of eastern and western in China is helpful for making policy about regional coordinated development and rapid development of national economy.This article makes a quantitative analysis and study on differences of the fixed investment of the eastern and the western regions in our country that the marginal rate of substitution of the fixed asset investment on the eastern and the western by using the marginal analysis method and the fixed asset investment contributes to economic growth rate from 1999 to 2013 time series data on the eastern and the western in China. We can get the trend is gradually decreasing of the marginal rate of substitution of the fixed asset investment in 15 years by quantitative analysis. At the same time, the western region has gradually caught up with the western region and growth for the fixed asset investment contributes to economic growth rate. First, we have carried on the unit root test to variable and determined stability and the lag order number. Then, the cointegration model is made about long-term equilibrium relationship between the fixed asset investment and GDP. Finally, we have the cointegration model about long-term equilibrium relationship and correlation coefficient between the fixed asset investment and GDP through the model regression. We find that the fixed asset investment plays a very important role in the GDP by the values of correlation coefficient. Through the above research, we found that the backward western region’s infrastructure level, low degree of marketization, the narrow of investment and backward system which affect differences of eastern and western in China. Some suggestions put forward that appropriate increasing investment scale of the western region, optimizing the investment environment, improve the efficiency of investment, encourage private investment and increase the intensity of western area opening to the outside world, to realize the balanced development of the eastern and western economy.