China’s Government Expenditures, Policies, and Promotion of the ICT Industry
Dr. Shahram Amiri, Shawnrece D. Campbell, Yuwen Ruan
China’s information and communications technology (ICT) industry is enormous and complex, covering a broad range of sub-sectors. Previous research conducted by Heshmati and Yang (2006) found that ICT accounted for up to 20% of China’s GDP growth from 1980-2001. They suggested that future research should analyze sub-sectors of China’s ICT industry to understand how each sub-sector individually contributed to China’s economic growth and to understand the policy options that affected each sub-sector. This paper examines if China’s government expenditures and policies for the high-tech industry and the information communication industry are the main driving force behind the booming success of those industries.We use correlation and regression analysis to determine if China’s government expenditures have reaped economic benefits through providing significant financial aid to the development of the high-tech industry in China and non-empirical data to determine if government expenditures and policies have aided the information communication industry. The empirical and non-empirical data results suggest that China’s government did not rely on traditional strategies, such as increasing government expenditures, to promote its ICT industry but employed various types of strategic methods to support the development of the industry. China’s government expenditures have not significantly aided the development of the high technology industry, but their policies have aided the information communication industry as is evident by this sub-sector’s 10% contribution to China’s GDP in 2010. The results will help us to understand which force(s) most impact the development of the ICT industry in China.
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