Overbuilding Roads in China Hinders Economic Growth, Study Finds
Infrastructure capital plays a crucial role in China's regional economic growth. Electricity, roads, rail, and land-line telephone infrastructure have positively impacted economic development in China's provinces. However, rapid road development in the Western region has led to declining growth momentum, challenging the belief that "more roads lead to prosperity". Investing in infrastructure beyond a certain level can become unproductive, potentially crowding out private capital. This study supports the idea that there is an optimal level of infrastructure development for economic growth, highlighting the importance of balanced and sustainable infrastructure investment.