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Spillover Effect Of Infrastructure And Regional Gap In China

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Author Info
Bihong HUANG
Feng DING
Abstract

Infrastructure provision in backward areas has been proposed by many studies as a cure for widening income gaps in developing countries like China. However, little has been said regarding infrastructure’s role as an unpaid production factor or the issue of optimal resource allocation. This paper examines the efficiency side of infrastructure provision in different Chinese provinces and its spillover effect on the non-infrastructure sector with an adapted dual-sector model. Our findings suggest that while the spillover effect on non-infrastructure sector is considerable across different Chinese regions, non-optimality of resource allocation still exists in regional attempts of developing public facilities.

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Article provided by Euro-American Association of Economic Development in its journal Applied Econometrics and International Development.

Volume (Year): 9 (2009)
Issue (Month): 2 ()
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Handle: RePEc:eaa:aeinde:v:9:y:2009:i:2_18

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Related research
Keywords: Dual-sector model; Infrastructure; Regional gap; Spillover effect;

Find related papers by JEL classification:
O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Regional, Urban, and Rural Analyses

References listed on IDEAS
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  1. Sylvie Démurger & Jeffrey D. Sachs & Wing Thye Woo & Shuming Bao & Gene Chang & Andrew Mellinger, 2002. "Geography, Economic Policy, and Regional Development in China," Asian Economic Papers, MIT Press, vol. 1(1), pages 146-197. [Downloadable!] (restricted)
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  2. Chen, Jian & Fleisher, Belton M., 1996. "Regional Income Inequality and Economic Growth in China," Journal of Comparative Economics, Elsevier, vol. 22(2), pages 141-164, April. [Downloadable!] (restricted)
  3. Aghion, Philippe & Schankerman, Mark, 2000. "A Model Of Market-Enhancing Infrastructure," CEPR Discussion Papers 2462, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  4. Aschauer, David Alan, 1989. "Is public expenditure productive?," Journal of Monetary Economics, Elsevier, vol. 23(2), pages 177-200, March. [Downloadable!] (restricted)
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  5. Easterly, William & Rebelo, Sergio, 1993. "Fiscal policy and economic growth: An empirical investigation," Journal of Monetary Economics, Elsevier, vol. 32(3), pages 417-458, December. [Downloadable!] (restricted)
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  6. Fleisher, Belton M. & Chen, Jian, 1997. "The Coast-Noncoast Income Gap, Productivity, and Regional Economic Policy in China," Journal of Comparative Economics, Elsevier, vol. 25(2), pages 220-236, October. [Downloadable!] (restricted)
  7. Acconcia, Antonio, 2000. "On growth and infrastructure provision," Research in Economics, Elsevier, vol. 54(2), pages 215-234, June. [Downloadable!] (restricted)
  8. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-99, June. [Downloadable!] (restricted)
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  9. Esfahani, Hadi Salehi & Ramirez, Maria Teresa, 2003. "Institutions, infrastructure, and economic growth," Journal of Development Economics, Elsevier, vol. 70(2), pages 443-477, April. [Downloadable!] (restricted)
  10. Demurger, Sylvie, 2001. "Infrastructure Development and Economic Growth: An Explanation for Regional Disparities in China?," Journal of Comparative Economics, Elsevier, vol. 29(1), pages 95-117, March. [Downloadable!] (restricted)
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