The Impact of the Belt and Road Initiative on the National Governance Level--Evidence from the Countries along the Belt and Road

Authors

  • Yuanxian Fu
  • Xianxin Liao
  • Hui Peng
  • Lin Jiang
  • Ye Li

DOI:

https://doi.org/10.56028/aemr.2.1.235

Keywords:

The Belt and Road Initiative; Five-Pronged Approach; Governance; Difference-in-differences Model.

Abstract

The Belt and Road Initiative is the Chinese approach to improving global governance. Based on country-level panel data, the paper analyzes the promoting effect of the Belt and Road Initiative on the governance of countries along the route by using difference in difference method. First, our study finds that the implementation of the Belt and Road Initiative has significantly improved the governance level of the countries along the route, and this finding remains robust after a series of tests. Second, the mechanism study finds that the Belt and Road Initiative improves governance in Belt and Road countries by influencing Chinese outward foreign direct investment (FDI) and Internet penetration in the countries along the route. Finally, the moderating effect suggests that the Belt and Road Initiative has a more significant impact on governance in countries that are closer to China and receive more official development assistance. Further heterogeneity analysis reveals that the governance promotion effect of the policy is more pronounced for countries with lower levels of economic development, population density, merchandise trade, and FDI.

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Published

2022-09-24