Port infrastructure investment and regional economic growth in China: Panel evidence in port regions and provinces: Fid-Bau Portal

Port infrastructure investment and regional economic growth in China: Panel evidence in port regions and provinces

Song, Lili / van Geenhuizen, Marina

Abstract China׳s seaports belong to the largest in the world. The question is to what extent port infrastructure investment in China also contributes to growth of the regional economies involved, through mainly direct and indirect relations. We estimate the output elasticity of port infrastructure through production function, applying panel data analysis for the period of 1999–2010, and calculate the model at the level of four port regions as well as the port province level. The results indicate clear positive effects of port infrastructure investment in all regions, however, the strength varies considerably among the four regions, with the Yangtze River Delta region (Shanghai) at the strongest level, followed by the Bohai Rim region (Tianjin), the Southeast region (Guangzhou) and the Central region, where the influence is the weakest. The analysis indicates that differences are related to the character of the port (land or sea), stage of economic development of the region, international network connectivity, and the spillover effects from adjacent regions. Overall, the weakest relation tends to be with landside transport infrastructure density. The paper closes with some policy implications.

Highlights • Port investment outputs in 1999–2010 vary among four sub-regions in China. • Yangtze and Bohai region enjoy the highest port investment output elasticity. • Central region merely with inland ports enjoys the lowest port investment output. • The relations are also observed on the level of port provinces. • Differences are related with land traffic endowment and stage of economic development.