Infrastructure, externalities and regional industrial productivity in China: a spatial econometric approach

This paper evaluates infrastructure's impact on regional industrial productivity in China and distinguishes between within- and cross-region effects. Three infrastructure assets are examined: electricity, roads and railways. The analysis reveals positive short-run spatial interaction of electricity and road infrastructure, but not of railways. In the long term, the spatial spillovers of infrastructure stocks are positive among provinces not in competition for production, but turn negative among provinces similar in productivity in the case of electricity and among locations similar in exports in the case of roads and railways.