The impact of economic development on urban livability: Evidence from 40 large and medium-sized cities of China

Abstract

Under the background that economy and urbanization of China are gradually entering the stage of high-quality development, clarifying the influence of economic development on urban livability is of significant academic and practical value. In this paper, regarded as one "factor", livability was introduced into the research framework of production function, and a theoretical model of the impact of economic development on urban livability was established. Based on the panel data of 40 cities in China from 2005 to 2019, the System GMM, panel threshold model and other methods were further adopted to carry out an empirical analysis. The results show that: (1) The livability level of large and medium-sized cities in China from 2005 to 2019 has been rising generally, but they present obvious characteristics of dimensional and spatial differentiation. (2) In general, economic development has an inhibiting effect on the improvement of urban livability, but this logical effect shows obvious heterogeneity in different time periods and diverse city scales. This inhibitory effect is more significant for the cities before entering the new normal phase of economy, and large-scale municipalities and economically-developed provincial capitals (namely Class-A cities). (3) There are significant threshold effects in the impact of economic development on urban livability, where the threshold variables are income level and economic development. With the increase of city dwellers' income, this effect presents an inverted N-shaped nonlinear feature. When the development of economy makes the average wage of employees between 60,000 and 80,000 yuan, economic development can significantly improve urban livability. Also, there is a significant single threshold inhibitory effect when economic development is taken as a threshold variable. However, its negative impact shows a law of diminishing marginal efficiency. In addition, a similar threshold effect is found in smaller-scale Class-B cities. The findings of this research can provide some insights for urban planners and policymakers in both China and vast developing countries to understand better the relationship between

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