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Chinese dialects, revolutionary war & economic performance

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  • Zhu, Junbing
  • Grigoriadis, Theocharis

Abstract

In this paper, we explore the effects of dialectal diversity on economic performance by drawing evidence from Chinese prefecture-level cities. Our dataset is a panel of 5-year average data over the period from 2001 to 2015 including 274 cities. We compute five indices of Chinese dialectal diversity: 1. Dialectal fractionalization; 2. Adjusted dialectal fractionalization; 3. Dialectal polarization; 4. Adjusted dialectal polarization and 5. Periphery heterogeneity. We find that dialectal fractionalization and dialectal polarization as well as periphery heterogeneity have a positive effect on both income per capita and economic growth. Adjusted dialectal fractionalization exhibits a positive effect only on the change in economic growth over time. However, adjusted dialectal polarization does not show any robust effects. Furthermore, the experience of being governed by the Chinese Communist Party during the revolutionary war inhibits the negative effects of dialectal diversity in eastern China, while it has persistent negative effects in central and north-eastern regions of the country.

Suggested Citation

  • Zhu, Junbing & Grigoriadis, Theocharis, 2020. "Chinese dialects, revolutionary war & economic performance," Discussion Papers 2020/7, Free University Berlin, School of Business & Economics.
  • Handle: RePEc:zbw:fubsbe:20207
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    More about this item

    Keywords

    dialectal diversity; local economic performance; communist governance;
    All these keywords.

    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • P51 - Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems
    • Z19 - Other Special Topics - - Cultural Economics - - - Other

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