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The Relationship between Artificial Intelligence and China’s Sustainable Economic Growth: Focused on the Mediating Effects of Industrial Structural Change

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  • Decheng Fan

    (School of Economics and Management, Harbin Engineering University, Harbin 150001, China)

  • Kairan Liu

    (School of Economics and Management, Harbin Engineering University, Harbin 150001, China)

Abstract

In recent years, the application of artificial intelligence (AI) has had a significant impact on economic development. This study examined the relationship between the level of AI development and economic growth in 28 Chinese provinces from 2005 to 2018, and we focused on the mediating role of the industrial structure. We found that the unreasonable state of the structure is an important reason behind the slowdown of China’s economic growth. The development of AI not only has a direct effect on economic growth, but can also improve economic slowdown by inhibiting industrial structure upgrading. Taking into account regional heterogeneity, we also conducted sub-regional regressions, and the results show that this mediating effect is particularly significant in the eastern, central, and western areas of China; the regression results also show that the development of AI technologies did not boost the economy before the 2008 financial crisis, but during the economic recovery period, the R&D and application of AI helped China’s economy to rebound. Thus, AI has gradually become an important power engine for high-quality and sustainable growth in China’s economy.

Suggested Citation

  • Decheng Fan & Kairan Liu, 2021. "The Relationship between Artificial Intelligence and China’s Sustainable Economic Growth: Focused on the Mediating Effects of Industrial Structural Change," Sustainability, MDPI, vol. 13(20), pages 1-15, October.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:20:p:11542-:d:659762
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    4. Julius Tan Gonzales, 2023. "Implications of AI innovation on economic growth: a panel data study," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 12(1), pages 1-37, December.

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