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Protectionism and Industry Location in Chinese Provinces

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  • Cecile Batisse
  • Sandra Poncet

Abstract

This paper investigates the determinants of activities' location in Chinese provinces based on a unique panel data set, paying particular attention to the role of local protectionism. We estimate a model of production location across Chinese provinces that combines factor endowments and geographical consideration. Results emphasize that the dynamics of comparative advantages and the forces of the new geographic economy are at work in Chinese provinces. Estimations, however, lend strong support to the role of local protectionism. The location of economic activities in Chinese provinces does thus not exclusively follow the logic of the market.

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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Journal of Chinese Economic and Business Studies.

Volume (Year): 2 (2004)
Issue (Month): 2 ()
Pages: 133-154

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Handle: RePEc:taf:jocebs:v:2:y:2004:i:2:p:133-154

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Related research

Keywords: China; protectionism; international trade; location of activities; externalities;

References

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  1. Paul Krugman & Anthony J. Venables, 1995. "Globalization and the Inequality of Nations," NBER Working Papers 5098, National Bureau of Economic Research, Inc.
  2. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
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  4. Mody, Ashoka & Wang, Fang-Yi, 1997. "Explaining Industrial Growth in Coastal China: Economic Reforms . . . and What Else?," World Bank Economic Review, World Bank Group, vol. 11(2), pages 293-325, May.
  5. Midelfart-Knarvik, K.H. & Overman, H.G. & Venables, A.J., 2000. "Comparative Advantage and Economic Geography: Estimating the Location of Production in the EU," Papers 18/00, Norwegian School of Economics and Business Administration-.
  6. Overman, Henry G. & Redding, Stephen J & Venables, Anthony J., 2001. "The Economic Geography of Trade Production and Income: A Survey of Empirics," CEPR Discussion Papers 2978, C.E.P.R. Discussion Papers.
  7. Davis, Donald R. & Weinstein, David E., 1999. "Economic geography and regional production structure: An empirical investigation," European Economic Review, Elsevier, vol. 43(2), pages 379-407, February.
  8. Bai, Chong-En & Du, Yingjuan & Tao, Zhigang & Tong, Sarah Y., 2004. "Local protectionism and regional specialization: evidence from China's industries," Journal of International Economics, Elsevier, vol. 63(2), pages 397-417, July.
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Citations

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Cited by:
  1. Li, Yao, 2008. "Industrial Agglomeration and Wage Inequality in China," MPRA Paper 11426, University Library of Munich, Germany, revised Oct 2008.
  2. Viswanathan P K, 2008. "Critical Issues Facing China’s Rubber Industry in the Era of Market Integration: An Analysis in Retrospect and Prospect," Working Papers id:1362, eSocialSciences.
  3. Maurice Catin & Christophe Van huffel, 2004. "Ouverture économique et inégalités régionales de développement en Chine : le rôle des institutions," Mondes en développement, De Boeck Université, vol. 128(4), pages 7-23.
  4. Zheng, Jinghai & Bigsten, Arne & Hu, Angang, 2006. "Can China’s Growth be Sustained? A Productivity Perspective," Working Papers in Economics 236, University of Gothenburg, Department of Economics.
  5. Y Wei & X Liu, 2006. "Productivity spillovers from R&D, exports and FDI in China's manufacturing sector," Journal of International Business Studies, Palgrave Macmillan, vol. 37(4), pages 544-557, July.

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