TITLE:
The Impact of the China’s Province-Managing-County Reform on Economic Growth in the Short Term and Long Term
AUTHORS:
Lingjing Wu
KEYWORDS:
China’s Province-Managing-County Reform, Economic Growth, In the Short and Long Term, DID
JOURNAL NAME:
Modern Economy,
Vol.8 No.11,
November
28,
2017
ABSTRACT: We use panel data from 1995 to 2012 to examine the
causal relationship between the China’s province-managing-county reform (PMC)
and the economic growth. In the identification method, we choose the difference-in-differences
method by the software of STATA. We find that the PMC reform on has a negative
effect on economic growth in the short-term, and has a positive effect on
economic growth in the long-term. The main reason for the differences is to
promote reform of infrastructure spending growth, in the short-term, the effect
is lagged, but in the long term, it will benefit from that. Otherwise, reform
makes the urban wage increase, than promote consumption, than the total amount
of investment will increase. At last, will have a positive impact on economic
growth. Overall, the reform has a positive effect on economic growth in the
long term.