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Regional convergence clubs in China: identification and conditioning factors

Author

Listed:
  • Weili Zhang

    (Henan University of Economics and Law)

  • Wei Xu

    (University of Lethbridge)

  • Xiaoye Wang

    (Henan University of Economics and Law)

Abstract

This paper investigates club convergence in income per capita of 329 prefecture-level city regions in China over a period of 1990 to 2014. A nonlinear time-varying factor model is adopted to examine convergence trends as the model allows for transitional heterogeneity and divergence from the actual growth path. The study further explores the driving forces of convergence clubs using an ordered response model. Four convergence clubs are identified, showing no geographic regularity in club member locations. The highest income club and the lowest income club tend to converge strongly, whereas two middle-income clubs converge weakly. The findings indicate that initial conditions, sectorial characteristics, preferential development policy, general government spending, network effect, spatial effect, and the role of globalization are the significant factors responsible for the formation of club convergence in China.

Suggested Citation

  • Weili Zhang & Wei Xu & Xiaoye Wang, 2019. "Regional convergence clubs in China: identification and conditioning factors," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 62(2), pages 327-350, April.
    • Handle: RePEc:spr:anresc:v:62:y:2019:i:2:d:10.1007_s00168-019-00898-y
    DOI: 10.1007/s00168-019-00898-y
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    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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