Impact of Soft-Input on the Cost of Resources and Environment in Economic Growth

Abstract

China’s rapid economic growth has proceeded at considerable cost of resources and environment. To find out how to reduce the cost while maintaining economic growth, we took panel data of 28 provinces from 2000 to 2009 as our samples and conducted comparative analysis on the said cost among 28 provinces. From the perspective of soft-input, we subsequently examined soft-input’s influence on the cost of re- sources and environment of in economic growth (CREIEG). Results show that: government spending on scientific research and environmental protections has a significant role in reducing energy consumption and wastewater discharge, but it has limited impact on gas emissions and solid waste emissions reduction. Moreover, financial development also has a positive role in reducing energy consumption. Finally, we propose a number of initiatives to reduce the cost of resources and environment of economic growth based on the analysis results.