Regional disparities in China's construction boom and bust: capital switching from 2002 to 2022

Xiao Ma and Sun Sheng Han

Chapter 4 in Research Companion to the Construction Industry in Developing Countries, 2026, pp 80-116 from Edward Elgar Publishing

Abstract: Building on Han and Ofori's work on the role of construction in China's economic development in the 1990s, this chapter examines the relationship between China's construction industry and economic growth during 2002–2022. The research highlights the risks of construction-dependent development through an integrative framework combining capital switching theory and the Turin model on construction in economic development. The analysis identified two major over-building crises (2006, 2016) with concurrent downturns in construction and GDP growth. In response, China underwent two phases of capital switching: first towards international construction projects, then towards technology-related sectors. The study reveals economically advanced regions successfully implemented both forms of capital switching, while less developed regions lacked these adaptive strategies. The findings challenge the Turin model by identifying a negative correlation between construction's GDP contribution and economic growth in China, while extending Harvey's capital switching theory by demonstrating movement from the built environment to the tertiary circuit.

Keywords: Construction industry; Economic development; Turin model; Capital switching; Regional distribution; China (search for similar items in EconPapers)
Date: 2026
ISBN: 9781035336302
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