The impact of the Belt and Road Initiative on China's New Industrialization: An empirical analysis based on a difference-in-differences model

Abstract

As a crucial initiative for constructing a new pattern of high-level opening up, the Belt and Road Initiative (BRI) provides a strategic opportunity for China's cities to integrate global resources for new industrialization. Based on this, this paper selects panel data from 275 prefecture-level cities across China from 2010 to 2023, and employs the difference-in-differences (DID) method to examine the impact, mechanism, and heterogeneity of BRI on the new industrialization of Chinese cities. The results indicate that BRI has a significant positive impact on the development of new industrialization in cities, and the baseline regression results remain robust after a series of tests, including the placebo test and PSM-DID. Mechanism analysis reveals that BRI significantly enhances the level of new industrialization in cities through three channels: innovation-driven effects, optimization of industrial structure, and promotion of market integration. Heterogeneity analysis demonstrates that BRI's promotion of new industrialization is more pronounced in central and western cities, cities within the Yangtze River Economic Belt, old industrial base cities, and cities with more complete new infrastructure construction. Therefore, it is necessary to continue deepening and promoting new industrialization policies, stimulating innovation vitality, and promoting the dual circulation of domestic and international markets based on local conditions, which is of great significance for ultimately achieving Chinese-style modernization.