Research Of Relationship Between Urbanization And Economic Growth In Hunan Province

Urbanization and economic growth are the two major themes of China’s economicand social development, both close relations and promote each other. Urbanization is theengine of China’s economic growth in the new period, and the economic growth is thefundamental driver of urbanization. Hunan as a populous province has a residentpopulation of6638.9million in the end of2012, ranked NO.8in China. However, theurbanization rate was46.65%, which is lower than the national average. What’s more,GDP per person has a rank of NO.20despite that we ranked10th in economy in2012.How to ensure both stable economic growth and rapid urbanization process,so that theurbanization and economic growth make a positive interaction. This requires us to furtherstudy the interaction mechanism of urbanization and economic growth.First, On the basis of theoretical analysis, we summarized the present situation of theurbanization construction in Hunan province from four aspects: the historical process, thedevelopment level, the regional coordination and rural migrant worker problems. Inaddition, we analyzed the present economic situation from the total amount of economicgrowth, growth speed, regional difference and industrial structure.Second, based on dynamic econometric analysis method, we built the Seilog modelof urbanization rate and GDP per capita using data from14cities in Hunan province in1978-2012. Two main conclusions have been made: for one, the real GDP per capita ofHunan province is the granger cause of urbanization level, when the GDP per capitachanges, it leads a change in the rate of urbanization but the reverse is not true. Foranother, every1%increase in real GDP per capital leads a0.128units increase in Hunanprovince urbanization. With this, if Hunan province economic growth rate is10%in2013,the urbanization level could increase1.28units. Third, in order to increase the credibilityof this study, we constructed Extended Cobb-Douglas model with panel data of regionalGDP, the urbanization level, the worker number at the end and the investment on fixedassets of the whole society from2001to2012of14city states. We reached a conclusionthat the urbanization coefficient of Changsha, Zhuzhou, Huaihua Xiangxi did not pass thesignificance test of coefficient. And for those who passed, we put them in order accordingto their urbanization rate: Loudi, Xiangtan, Chenzhou, Zhangjiajie, Yiyang, Shaoyang,Yueyang, Changde, Yongzhou, Hengyang.Last but not the least, we end with a summary of the results of theoretical researchand empirical test. With present situation of Hunan province, we put forward a theoretical and practical basis on how to promote urbanization-related policies.