Research On The Relationship Between Infrastructure Investment And Economic Growth In China's Northwest Area

The Chinese government increased the infrastructure investment gradually in northwest area since the implementation of the western development strategy. The condition of the infrastructure investment in northwest area had been improved with the rapid development of the economy. However, compared with the average level of our country, infrastructure investment in northwest area is still in a backward position. The effect of “bottlenecks” to the economy becomes more and more apparent. The paper try to find the impact of infrastructure investment to the economy through the analysis of the relationship between the infrastructure investment and economic growth.In this paper, the idea is as follows. Firstly, the paper introduces the background of the infrastructure investment, and then makes a simple definition on the infrastructure investment and western area to clarify the problem we solve and the scope of the research. Secondly, the paper introduces some related investment theory to support the analysis of the infrastructure investment. Thirdly, the paper makes a simple introduction of the infrastructure investment in northwest provinces. And finally, the paper chooses VAR model to analysis the impact of infrastructure investments on the economic growth. And through the stationary test and cointegration test of the infrastructure investment and economic output, it indicates the stable equilibrium relationship between the infrastructure investments and economic output. Also, it indicates that the infrastructure investments have a significant impact on economic output through the Granger causality test. And finally, the paper draws out the dynamic impact of infrastructure investment on economic growth by using the impulse response function and variance decomposition.