An Empirical Study of the Grand Canal on Green Total Factor Productivity in Riverside Counties

The Grand Canal, a jewel in the history of Chinese civilization, has been fully navigated for the first time in a century in 2022. How to measure the impact of this natural resources on the development of the riverside counties’ economies and explore the mechanism in order to better utilize it is an urgent question of our time. To address the research questions, this paper selects 10,890 panel data from 19 cities and 55 counties in 6 provinces, constructs a canal green total factor production system and measures the green total factor productivity of all flow curves of the Grand Canal using Malmquist index. It is found that (1) the Grand Canal has a significant effect on the improvement of green total factor productivity in county economies along the route. The interaction term of canal-county distance and canal flow has a significant pulling effect. (2) Green total factor productivity shows a synergistic trend in the county areas along the canal, with positive effects on the level of educational resources and government expenditure. The negative effects on the level of urbanization and service industry development. (3) The decreasing order of green total factor productivity along Jiangnan Canal, Lu Canal, and North-South Canal indicates that canals can be navigated have stronger contribution to green total factor productivity of county economies along the route.