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Natural Resources, Institutional Quality, and Economic Growth in China

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  • Kan Ji
  • Jan Magnus
  • Wendun Wang

Abstract

The resource curse has been mainly studied using cross-country samples. In this paper we analyze a cross-province sample from one country: China. We focus on the interplay between resource abundance, institutional quality, and economic growth, using two different measures of resource abundance (a stock: resource reserves; and a flow: resource revenues), and employing various econometric approaches including varying coefficient models. We find that resource abundance has a positive effect on economic growth at the provincial level in China between 1990 and 2008, an effect that depends nonlinearly on institutional quality (1995 confidence in courts). The ‘West China Development Drive’ policy, initiated in 2000, caused substantial changes, which we investigate through a comparative panel-data analysis. Copyright Springer Science+Business Media Dordrecht 2014

Suggested Citation

  • Kan Ji & Jan Magnus & Wendun Wang, 2014. "Natural Resources, Institutional Quality, and Economic Growth in China," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 57(3), pages 323-343, March.
    • Handle: RePEc:kap:enreec:v:57:y:2014:i:3:p:323-343
    DOI: 10.1007/s10640-013-9673-8
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    More about this item

    Keywords

    Natural resource curse; Economic growth; China ; Institutional quality; Resource abundance; Policy change; Functional effect; O11; O13; O53; C21; Q0; Q33;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • Q0 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General
    • Q33 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Resource Booms (Dutch Disease)

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