Analysis of the Correlation between the China's Information Level and the Industrialization Level

The object of this paper is to investigate the relationship between the development level of China's information and the industrialization process. In order to quantify the relationship between the two variables, Granger causality test and the VAR model impulse response function and variance decomposition technique were chosen in this study. The time span of the data used in this paper was from the year of 1985 to 2008. Through empirical analysis, the main conclusions of this paper are: (1) there is the long-term stability of the cointegration relationship between the information technology level and the process of industrialization; (2) the level of information technology change is the one-way Granger cause for the change of industrialization, and has an important influence on the industrialization. And accordingly, the corresponding policy recommendations were put forward.