The Economic Effect of the Steel Industry on Sustainable Growth in China—A Focus on Input–Output Analysis

Abstract

The purpose of this study is to analyze the economic ripple effects caused by the supply-side reforms on China’s steel industry. To this end, using the 2012 and the 2017 China Input–Output Tables, this study analyzes the economic ripple effect of the Chinese steel industry caused by its supply-side reform. In this study, the influence coefficients (rear-linked effect) and the sensitivity coefficients (forward-linked effect), conceptualized by Leontief, are used as research tools to analyze the ripple effects of the Chinese steel industry. The analysis results are as follows. First, the fact that 2012 ranked high in professional equipment and meter manufacturing shows that the Chinese government’s supply-side reforms are effective and creating the required shift from traditional manufacturing to qualitative growth. Second, in terms of the sensitivity coefficient, in 2012, most of the top industries contributed significantly to the development of the Chinese economy. The originality of this study is as follows. The input production analysis used in this paper is a methodology mainly used in the steel, coal, automobile, and petrochemical industries, which clearly distinguishes the front and rear industries. Additionally, this study is a novel attempt at comparative research on the Chinese steel industry between 2012 and 2017.