Explaining Spatial Convergence of China’s Industrial Productivity
This paper investigates the conditions that may auger a reversal of China’s increasingly unequal levels of regional industrial productivity during China’s first two decades of economic reform. Using international and Chinese firm and industry data over the period 1995-2004, we estimate a productivity growth-technology gap reaction function. We find that as China’s coastal industry has closed the technology gap with the international frontier relative to interior regions, labor productivity growth in the coastal region has begun to slow in relation to the interior. This may serve as an early indicator of China’s initial movement toward reversing the widespread income inequality.
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- Timmer, Marcel & Ypma, Gerard & van Ark, Bart van, 2007. "PPPs for Industry Output: A New Dataset for International Comparisons," GGDC Research Memorandum GD-82, Groningen Growth and Development Centre, University of Groningen.
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- Gary H. Jefferson & Albert G. Z. Hu & Jian Su, 2006. "The Sources and Sustainability of China's Economic Growth," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 37(2), pages 1-60.