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Understanding China’s recent growth experience: A spatial econometric perspective

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  • Long Gen Ying

Abstract

This study reconsiders the question of China’s recent growth experience from a spatial econometric perspective. An empirical model of Chinese output growth using cross provincial data over the 1978–1998 period is specified, but a spatial econometric analysis of the specification reveals strong evidence of misspecification due to ignored spatial lag dependence. The subsequent estimating using Anselin’s spatial lag model determines the important sources of growth to be the growth of non-farm labor force, manufactured products, capital stock, and realized direct foreign investment. On the other hand, the estimated coefficient for the spatial lag variable suggests a polarizing process undergoing within the Chinese spatial economy, and the resulting change in the estimates of causal factors implies that as marketization progresses, a variety of spillover effects due to factor mobility, transfer payments and technological diffusion become operational, which actually improve the marginal productivity of factor inputs for labor (G L ) and capital (G K , G DFI ) and bring national output closer to its frontier of the Chinese economy. Copyright Springer-Verlag 2003

Suggested Citation

  • Long Gen Ying, 2003. "Understanding China’s recent growth experience: A spatial econometric perspective," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 37(4), pages 613-628, December.
  • Handle: RePEc:spr:anresc:v:37:y:2003:i:4:p:613-628
    DOI: 10.1007/s00168-003-0129-x
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    Cited by:

    1. Carlo Ciccarelli & Stefano Fachin, 2017. "Regional growth with spatial dependence: A case study on early Italian industrialization," Papers in Regional Science, Wiley Blackwell, vol. 96(4), pages 675-695, November.
    2. Li Dong & Le Canh, 2010. "Nonlinearity and Spatial Lag Dependence: Tests Based on Double-Length Regressions," Journal of Time Series Econometrics, De Gruyter, vol. 2(1), pages 1-18, June.
    3. Yongbok Jeon & Tae Hwan Yoo, 2009. "Regional Growth and Income Inequality in China After 1978: A Spatial Econometric Approach," Korean Economic Review, Korean Economic Association, vol. 25, pages 105-131.
    4. José Villaverde & Adolfo Maza, 2012. "Chinese per Capita Income Distribution, 1992–2007: A Regional Perspective," Asian Economic Journal, East Asian Economic Association, vol. 26(4), pages 313-331, December.
    5. repec:zbw:bofitp:2010_015 is not listed on IDEAS
    6. Li, Qing & Vo, Long Hai & Wu, Yanrui, 2019. "Intangible capital distribution in China," Economic Systems, Elsevier, vol. 43(2), pages 1-1.
    7. Yanhui Wang & Heying Li, 2017. "Modeling Comprehensive Dispersion of the Administrative Villages and Its Association with Economic Poverty: A Case Study from Poverty-Stricken Mountainous County, China," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 133(1), pages 67-91, August.
    8. Eric Girardin & Konstantin A. Kholodilin, 2011. "How helpful are spatial effects in forecasting the growth of Chinese provinces?," Journal of Forecasting, John Wiley & Sons, Ltd., vol. 30(7), pages 622-643, November.
    9. José Villaverde & Adolfo Maza & Bala Ramasamy, 2010. "Provincial Disparities in Post‐reform China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 18(2), pages 73-95, March.
    10. Bai, Chong-En & Ma, Hong & Pan, Wenqing, 2012. "Spatial spillover and regional economic growth in China," China Economic Review, Elsevier, vol. 23(4), pages 982-990.
    11. You, Jing, 2013. "China's challenge for decarbonized growth: Forecasts from energy demand models," Journal of Policy Modeling, Elsevier, vol. 35(4), pages 652-668.
    12. Ying Yu & Yong Li & Pengfei Ge & Hua Rong, 2023. "Spatial Spillover and Convergent Mechanism of Urban–Rural Financial Imbalances: Evidence from China," Land, MDPI, vol. 12(7), pages 1-22, July.
    13. Hao, Yu & Zhang, Zong-Yong & Liao, Hua & Wei, Yi-Ming, 2015. "China’s farewell to coal: A forecast of coal consumption through 2020," Energy Policy, Elsevier, vol. 86(C), pages 444-455.
    14. Y.H. Dennis Wei & Xinyue Ye, 2009. "Beyond Convergence: Space, Scale, And Regional Inequality In China," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 100(1), pages 59-80, February.
    15. Herrmann-Pillath, Carsten & Libman, Alexander & Yu, Xiaofan, 2014. "Economic integration in China: Politics and culture," Journal of Comparative Economics, Elsevier, vol. 42(2), pages 470-492.
    16. Mohamed Mekki Ben Jemaa, 2016. "Economic, Political and Cultural Proximity and Growth Propagation: A Network Model with Endogenous Proximity Matrix," Working Papers 1047, Economic Research Forum, revised 09 Jan 2016.
    17. Laura Hering & Sandra Poncet, 2010. "Income Per Capita Inequality in China: The Role of Economic Geography and Spatial Interactions," The World Economy, Wiley Blackwell, vol. 33(5), pages 655-679, May.
    18. Yingru Li, 2012. "The spatial variation of China's regional inequality in human development," Regional Science Policy & Practice, Wiley Blackwell, vol. 4(3), pages 263-278, August.
    19. Ma, Tao & Hong, Tao & Zhang, Haozhe, 2015. "Tourism spatial spillover effects and urban economic growth," Journal of Business Research, Elsevier, vol. 68(1), pages 74-80.
    20. Feng Li & Guangdong Li, 2018. "Agglomeration and Spatial Spillover Effects of Regional Economic Growth in China," Sustainability, MDPI, vol. 10(12), pages 1-13, December.
    21. Zhao, Xin & Nakonieczny, Joanna & Jabeen, Fauzia & Shahzad, Umer & Jia, Wenxing, 2022. "Does green innovation induce green total factor productivity? Novel findings from Chinese city level data," Technological Forecasting and Social Change, Elsevier, vol. 185(C).

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