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Understanding openness and productivity growth in China: An empirical study of the Chinese provinces

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  • Jiang, Yanqing
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    Abstract

    This paper investigates the effects of openness on China's regional productivity growth. We build a model of technology diffusion in which follower economies achieve productivity growth by taking advantage of technology spillovers from the world technology frontier. We hypothesize that China's regional productivity growth is a positive function of regional openness and a negative function of the current level of regional productivity. Empirical analysis in this paper focuses on how openness affects productivity growth in the Chinese provinces. We examine two effects of openness on regional productivity growth in China: the direct growth effect and the convergence effect. By using a variety of panel data regression techniques, we show that the direct growth effect of openness is the main effect while the convergence effect is insignificant. The findings of this paper lend strong support to the claim that the opening-up of China promotes the country's economic growth.

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    Bibliographic Info

    Article provided by Elsevier in its journal China Economic Review.

    Volume (Year): 22 (2011)
    Issue (Month): 3 (September)
    Pages: 290-298

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    Handle: RePEc:eee:chieco:v:22:y:2011:i:3:p:290-298

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    Web page: http://www.elsevier.com/locate/chieco

    Related research

    Keywords: Productivity Openness Convergence;

    References

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    Cited by:
    1. Yingxin Shi & Mototsugu Fukushige, 2013. "Long-Run Fiscal Multiplier for Autonomous Prefectures in China," Discussion Papers in Economics and Business 13-10, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP).
    2. Bai, Chong-En & Ma, Hong & Pan, Wenqing, 2012. "Spatial spillover and regional economic growth in China," China Economic Review, Elsevier, vol. 23(4), pages 982-990.
    3. Caldeira, Emilie, 2012. "Yardstick competition in a federation: Theory and evidence from China," China Economic Review, Elsevier, vol. 23(4), pages 878-897.
    4. Timo Mitze & Selin Özyurt, 2012. "The spatial dimension of trade- and FDI-driven productivity growth in Chinese provinces: A global cointegration approach," ERSA conference papers ersa12p512, European Regional Science Association.

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