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Local protectionism and regional specialization: evidence from China's industries

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  • Bai, Chong-En
  • Du, Yingjuan
  • Tao, Zhigang
  • Tong, Sarah Y.

Abstract

This paper uses a dynamic panel estimation method to investigate the determinants of regional specialization in China???s industries, paying particular attention to local protectionism. Less geographic concentration is found in industries where the past tax-plus-profit margins and the shares of state ownership are high, re- flecting stronger local government protection of these industries. The evidence also supports the scale-economies theory of regional specialization. Finally, the overall time trend of regional specialization of China???s industries is found to have reversed an early drop in the mid 1980s, and registered a significant increase in the later years.
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Suggested Citation

  • 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.
    • Handle: RePEc:eee:inecon:v:63:y:2004:i:2:p:397-417
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    More about this item

    JEL classification:

    • F1 - International Economics - - Trade
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • P2 - Economic Systems - - Socialist Systems and Transition Economies

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