An Empirical Test on Regional Spillovers through Intra-and Inter-national Trade

This study aims at providing econometrical evidence to support a theory predicting that in developing countries, intra-national trade, together with international trade, form a network in which high growth achieved by the developed regions spills over to the less developed regions. Using China's 2007 foreign trade data and provincial input-output tables, the key variables on intra-and international imports of technological inputs are built for estimating their impacts over outputs at the province and sector levels. It is found that in the less developed regions, intra-national imports rather than international ones made significant contribution to production. In the developed regions, these impacts were just inversed. This result confirms the theory on the existence of the trade network.