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The Dynamics of Provincial Growth in China: A Nonparametric Approach

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We use a recently developed non-parametric approach to analyze the variation in labor productivity growth across China's provinces. This approach imposes less structure on the data than the standard growth accounting framework and allows for a breakdown of labor productivity into capital deepening, efficiency gains, and technological progress. We find that capital deepening is the prime factor behind the change in the distributional dynamics of the labor productivity: on average capital deepening accounts for 75 percent of total labor productivity growth, while improvements in efficiency and technological progress account for 7 percent and 18 percent, respectively. We also find that while improvements in efficiency levels are higher in initially less productive provinces, relatively more productive provinces benefitted more from technological progress than less developed ones.

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  • Bulent Unel & Harm Zebregs, 2007. "The Dynamics of Provincial Growth in China: A Nonparametric Approach," Departmental Working Papers 2007-03, Department of Economics, Louisiana State University.
    • Handle: RePEc:lsu:lsuwpp:2007-03
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    2. Shahid Yusuf, 2012. "From Technological Catch-up to Innovation : The Future of China’s GDP Growth," World Bank Publications - Reports 12781, The World Bank Group.
    3. Li, Kui-Wai & Liu, Tung, 2011. "Economic and productivity growth decomposition: An application to post-reform China," Economic Modelling, Elsevier, vol. 28(1), pages 366-373.
    4. Petr Blížkovský, 2012. "Regional disparities and convergences in Asia," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 60(4), pages 47-58.
    5. Simon Alder & Lin Shao & Fabrizio Zilibotti, 2012. "The Effect of Economic Reform and Industrial Policy in a Panel of Chinese Cities," DEGIT Conference Papers c017_061, DEGIT, Dynamics, Economic Growth, and International Trade.
    6. Petr Blizkovsky, 2012. "Are We Living in a Converging World? Regional Disparities and Convergences from a Global Perspective," Research in World Economy, Research in World Economy, Sciedu Press, vol. 3(2), pages 41-51, September.
    7. Henderson, Daniel J. & Tochkov, Kiril & Badunenko, Oleg, 2007. "A drive up the capital coast? Contributions to post-reform growth across Chinese provinces," Journal of Macroeconomics, Elsevier, vol. 29(3), pages 569-594, September.
    8. Oleg Badunenko & Kiril Tochkov, 2010. "Soaring dragons, roaring tigers, growling bears," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 18(3), pages 539-570, July.
    9. Declan Curran & Michael Funke & Jue Wang, 2007. "Economic Growth across Space and Time: subprovincial Evidence from Mainland China," Quantitative Macroeconomics Working Papers 20710, Hamburg University, Department of Economics.
    10. Petr Blížkovský, 2012. "Regional disparities and convergences in America," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 60(4), pages 37-46.
    11. Yuheng LI & Hans WESTLUND, 2013. "Interpreting Overall Inequality In China: The Roles Of Physical Capital, Human Capital And Social Capital," Regional Science Inquiry, Hellenic Association of Regional Scientists, vol. 0(2), pages 145-150, December.
    12. Diego Romero-Ávila, 2013. "Is Physical Investment The Key To China'S Growth Miracle?," Economic Inquiry, Western Economic Association International, vol. 51(4), pages 1948-1971, October.

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