Abstract:

Relationship between resource use and economic growth is the important field of resources and environmental economics studies.The paper attempts to integrate Material Flow Analysis (MFA) approach and the newly developed autoregressive distributed lag (ARDL)bounds testing approach to examine the relationship between resource use and real GDP for Tongling City of Anhui Province,during the period of 1990~2008.The direct material input (DMI),one of subaccounts of MFA,is also used as the proxy variable of resource use.The results of the bounds test indicate that a longrun cointegration relationship exists between the proxy of resource use and the explanatory variable:economic growth.The longrun parameters are estimated through a longrun static solution of the estimated ARDL model,and then the shortrun dynamics are estimated by the error correction model.The study also indicates the existence of shortrun and longrun causality running from resource use to economic growth.The findings imply that resource use is a stable forcing variable for economic growth in Tongling City.The estimation results are also of policy implication on economic development and resource conservation strategies for Tongling City