Assessing the effect of the integration among the urbanization and industries development in Three Gorges Reservoir (TGR) area in China based on P-VAR Models/ created by Xiaoqin Zou, Guohua Cao, Jingwei Jiang and Xiangyan Liu

rbanization is an important engine in regional economic development and transformation. In this paper, panel-vector autoregressive (P-VAR) models are constructed based on panel data of the Three Gorges reservoir in China during the period 2007–2011. Using the impulse-response function and variance decomposition, this paper empirically analyzes the relevance between urbanization and industry development. The authors find that (1) agriculture development has a short and weak effect on urbanization, but the latter has no such effect on the former; (2) there is no significant integration between urbanization and manufacturing industry development; and (3) service development has a long, persistent, and gradually strengthening effect on urbanization and vice versa. This indicates a prominent integration between urbanization and service development. The findings suggest that policies that promote and support service and modern agriculture development will promote the New Urbanization development of the Three Gorges Reservoir area.