Resources Science ›› 2019, Vol. 41 ›› Issue (1): 196-206.doi: 10.18402/resci.2019.01.18

• Orginal Article • Previous Articles    

Does the Rocky Desertification Control Project promote county economic development? An empirical analysis based on DID methods using 88 counties' panel data of Guangxi

Juan PANG1,2(), Ruiping RAN1()   

  1. 1. College of Management, Sichuan Agricultural University, Chengdu 611130, China
    2. Business School, Yulin Normal University, Yulin 537000, China
  • Received:2018-06-14 Online:2019-01-25 Published:2019-01-25

Abstract:

The Rocky Desertification Control Project (RDCP) has become a major ecological restoration and livelihood project in the karst areas of Southwest China, which could prevent soil erosion, restore ecological environment, promote social and economic development, and improve household's livelihood. The impact of the RDCP is a major issue worthy of attention. This study theoretically analyzed the influencing mechanism of the RDCP on the development of County economic and evaluated the RDCP's economic impact based on panel data collected from 88 counties of Guangxi province from 2006 to 2016, using the Difference-in-Difference (DID) method. We first estimated the average impact of the RDCP on county economic development. Then we evaluated the dynamic impact of the RDCP, using the panel fixed effect model. The results illustrate that RDCP has a sustainably positive and statistically significant impact on the county economic development. Regardless of whether other variables are controlled, the economic development level of the treat group is significantly higher than that of the control group. Furthermore, the longer the RDCP is implemented, the greater the impact is. It means that with the help of various favorable policy measures for the RDCP, the rocky desertification areas can continuously accumulate favorable factors for economic development and form a “cyclical accumulation. ” With conducting the robustness test, we found that the results of the empirical analysis are reliable. The DID method can indeed give a reasonable estimate of the causal effects of the RDCP and county economic development. The results confirm the positive impact of the first phase of RDCP on the economic development. RDCP will have an important policy implication for the second phase of the RDCP and the establishment of relevant policies.

Key words: county economic development, the Rocky Desertification Control Project, policy effect, Difference-in-Difference method