WHAT CAME FIRST, TRANSPORTATION OR URBANIZATION?

This paper proposes new perspective on the nexus between transportation and urbanization in China to test the search-matching theory. We find that the linkage between transportation and urbanization has both frequency and time-varying features. We find that transportation improves urbanization in the short term, while urbanization plays the importation role in transportation during the period 1969–1996. This result obviously supports search-matching theory that in the subsample periods, the transportation infrastructure exerts positive effects on urbanization in the short term but not in the long term. In the long term, urbanization will promote the development of transportation, while short-term traffic infrastructure investment can effectively improve the transfer of population to urban regions. It would be beneficial for the government to formulate the scientific traffic planning policy and adjust the transport structure to improve urbanization. [ABSTRACT FROM AUTHOR]