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Centripetal Forces in China's Economic Takeoff

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  • Anuradha Dayal-Gulati

    (International Monetary Fund)

  • Aasim M. Husain

    (International Monetary Fund)

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    Abstract

    This paper uses provincial time series data from the People's Republic of China to empirically investigate two propositions relating to economic development: (i) that economic takeoff--or an acceleration in economic growth--is associated with inflows of foreign direct investment (FDI), possibly through technological transfer; and (ii) that takeoff is accompanied, at least in the short term, by widening income inequality. The results indicate that FDI flows have increased the rate of convergence in per capita incomes across China's provinces. However, the pattern of FDI, which has gone mainly to the relatively wealthy provinces, has caused different provinces to converge toward different steady states. . Copyright 2002, International Monetary Fund

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    Bibliographic Info

    Article provided by Palgrave Macmillan in its journal IMF Staff Papers.

    Volume (Year): 49 (2002)
    Issue (Month): 3 ()
    Pages: 4

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    Handle: RePEc:pal:imfstp:v:49:y:2002:i:3:p:4

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    Cited by:
    1. Lee, Hsiu-Yun & Lin, Kenneth S. & Tsui, Hsiao-Chien, 2009. "Home country effects of foreign direct investment: From a small economy to a large economy," Economic Modelling, Elsevier, Elsevier, vol. 26(5), pages 1121-1128, September.
    2. Roberto Ezcurra & Andrés Rodríguez-Pose, 2009. "Does decentralization matter for regional disparities? A cross-country analysis," LSE Research Online Documents on Economics, London School of Economics and Political Science, LSE Library 33244, London School of Economics and Political Science, LSE Library.
    3. Roy Bahl & Jorge Martinez-Vazquez, 2003. "Fiscal Federalism and Economic Reform in China," International Center for Public Policy Working Paper Series, at AYSPS, GSU, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University paper0313, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    4. Cerra, Valerie & Saxena, Sweta Chaman, 2003. "How responsive is Chinese export supply to market signals?," China Economic Review, Elsevier, Elsevier, vol. 14(3), pages 350-370.
    5. Bulent Unel & Harm Zebregs, 2006. "The Dynamics of Provincial Growth in China," IMF Working Papers, International Monetary Fund 06/55, International Monetary Fund.

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