Regional Policy and Balanced Development: Spatial Evidence from Inner Mongolia of China

Unfavorable initial conditions and limited factor endowments often constrain economic development in border regions, whereas regional development policies can alter locational disadvantages and promote balanced regional development. Based on nighttime light data from 1999 to 2022, this paper employs a spatial regression discontinuity design (spatial RDD) to examine economic differences between border and non-border areas in Inner Mongolia, China, and to assess the effects of regional development policies in underdeveloped regions. The results show that, after controlling for initial endowments and economic characteristics, the Program of Border Areas Revitalization and Poverty Alleviation significantly enhances economic vitality in border regions and generates persistent growth effects; these findings remain robust after excluding potential confounding factors and conducting a series of robustness checks. Heterogeneity analysis indicates that the policy effects are more pronounced in eastern Inner Mongolia, in more densely populated areas, and in regions with higher market vitality. Mechanism analysis suggests that the Program of Border Areas Revitalization and Poverty Alleviation alters locational disadvantages by strengthening the provision of public goods, thereby enhancing economic linkages across regions; the development of characteristic and comparative advantage industries promotes industrial structure upgrading and drives economic growth in border areas. Further analysis finds that the Program of Border Areas Revitalization and Poverty Alleviation reduces, to some extent, intra-regional economic disparities within border areas and promotes sustainable economic development while improving the ecological environment, further indicating that there exists a compatible pathway between regional development and ecological sustainability. Overall, this study provides spatially explicit micro-level evidence on how regional policies can reshape geographical constraints and foster balanced development in underdeveloped border regions.