The Impact Of Urban Public Infrastructure On Production Costs Of Enterprises

At present,deepening the supply-side structural reform is an important measure for building China's modern economic system.The supply-side structural reform focuses on"cutting overcapacity,destocking,deleveraging,reducing costs and identifying growth areas".Among them,"reducing costs"refers to reducing the cost of enterprises,which is a major problem for Chinese manufacturing enterprises to overcome.At the same time of rapid economic development,China's infrastructure investment and construction have also achieved leap-forward development.Therefore,the impact of infrastructure on economic development is also a research hotspot in academia.Then,under the background that China's manufacturing cost is high and supply-side structural reform requires"reducing costs",it is undoubtedly of great practical significance to study the impact of infrastructure on production costs and its mechanism.The assessment of the value of infrastructure stocks is the basis for subsequent research.This paper firstly uses the perpetual inventory method to estimate the stock of four major types of infrastructure in China's Prefecture-level and above cities,and analyzes the estimated results.On this basis,the transcendental logarithmic cost function model including infrastructure as one of the production factors was established.The panel of manufacturing enterprises from 2003-2007 China Industrial Enterprise Database was used to empirically examine the impact of infrastructure on production costs.The empirical results show that Chinese government's increased investment in different types of urban infrastructures can significantly affect the average production costs of manufacturing enterprises.The investment in energy supply and water supply and drainage infrastructures will increase production costs of manufacturing enterprises.And the increase in transportation and environmental protection infrastructures will help companies reduce production costs.At the same time,different infrastructures have complementary or substitution effects on input factors such as laboIr,capital and intermediate goods.Further,for companies of different ownerships and sizes,when the government increases investment in infrastructure construction,private and small-scale enterprises can adjust the factor input structure most flexibly,while state-owned and large-scale enterprises have the least flexibility.However,due to the advantages of other factors such as factor resources,these two types of enterprises can often avoid excessive increase in production costs and achieve the greatest reduction in costs.This paper supplements and improves the existing infrastructure stock estimation research,and verifies the impact of macro infrastructure investment on micro-enterprise production cost,and has certain reference significance for supply-side structural reform.