The Effects of Investment in Major Construction Projects on Regional Economic Growth Quality: A Difference-In-Differences Analysis Based on PPP Policy

Fang Wang, Ming Yao, Xianhua Huang, Hao Guo, Penghui Zheng and Hongwei Yu
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Fang Wang: Ningxia Coal Industry of China Energy Group, Yinchuan 751400, China
Ming Yao: Ningxia Coal Industry of China Energy Group, Yinchuan 751400, China
Xianhua Huang: China Energy Inverstment Group, Beijing 100011, China
Hao Guo: Economics and Management School, Wuhan University, Wuhan 430072, China
Penghui Zheng: Economics and Management School, Wuhan University, Wuhan 430072, China
Hongwei Yu: Institute of Quality Development Strategy, Wuhan University, Wuhan 430072, China

Sustainability, 2022, vol. 14, issue 11, 1-14

Abstract: The investment in Major Construction Projects (MCPs) has a counter-cyclical impact on quantitative GDP increases during the recession period. However, its impact on the quality of economic growth is still unknown. Based on the data of prefecture-level cities in China from 2008 to 2017, we construct an economic Quality Growth Index (QGI) including sustainable development factors and take the PPP (Public–Private Partnership projects) policy as a quasi-natural experiment to design a Difference-In-Differences (DID) strategy for the first time to estimate the effects of the MCPs investment on the sustainable development of regional economies. We find that the MCPs investment can significantly improve the quality of regional economic growth. The MCPs investment can improve the quality of regional economic growth by enhancing innovation and entrepreneurship at the regional levels. Our findings may provide empirical evidence to support the policy of increasing investment into infrastructure constructions to promote sustainable development in the current economic recession under the COVID-19 pandemic.

Keywords: major construction project; economic growth quality; PPP policy; regional entrepreneurship; Difference-In-Differences (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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