The co-integration analysis of relationship between urban infrastructure and urbanization - A case of Shanghai

Urban infrastructure and urbanization influence each other, and quantitative analysis of the relationship between them will play a significant role in promoting the social development. The paper based on the data of infrastructure and the proportion of urban population in Shanghai from 1988 to 2013, use the econometric analysis of co-integration test, error correction model and Granger causality test method, and empirically analyze the relationship between Shanghai’s infrastructure and urbanization. The results show that: 1) Shanghai Urban infrastructure has a positive effect for the development of urbanization and narrowing the population gap; 2) when the short-term fluctuations deviate from long-term equilibrium, the system will pull the non-equilibrium state back to equilibrium with an adjust intensity 0.342670. And hospital infrastructure is not only an important variable for urban development in short-term, but also a leading infrastructure in the process of urbanization in Shanghai; 3) there has Granger causality between road infrastructure and urbanization; and there is no Granger causality between water infrastructure and urbanization, hospital and school infrastructures of social infrastructure have unidirectional Granger causality with urbanization.