The Impact of Transport Infrastructure Investment on Energy Intensity: The Perspective of Fiscal Decentralization

Abstract

Investment in China’s transport infrastructure has contributed to its rapid economic growth, which also consumes a great deal of energy and generates a significant amount of carbon emissions. In these circumstances, it is worthwhile to discuss the internal influence mechanisms behind these two outcomes’ similar growth trends. This paper selects panel data from 30 regions in China from 2009 to 2019 and uses the threshold spatial autoregressive (TSAR) model to analyze the impact of transport infrastructure investment on the energy intensity due to fiscal decentralization. While studies of the relationship between transport infrastructure investment and energy intensity exist, few studies examine the non-linear spatial relationship between the two. This paper fills this gap by using the TSAR Model. The results show the following: (1) the effect of transport infrastructure investment on the energy intensity under fiscal decentralization and heterogeneity expresses non-linear characteristic; (2) there is a positive relationship between infrastructure investment and energy intensity when the degree of attenuation is low, but when the degree of attenuation is higher than a particular threshold value, transport infrastructure investment negatively impacts energy intensity; (3) rising energy prices, increasing investment in technological innovation costs, and increasing foreign trade will help to drive the decline in energy intensity.