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The effects of China’s growth slowdown on its provinces: Disentangling the sources

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  • Anping Chen
  • Nicolaas Groenewold

Abstract

Since 2007, China's growth has fallen from around 10% to about 6%–7% per annum. This paper investigates the experience of this slowdown at the provincial level. We use a vector‐autoregressive modelling approach and annual data from 1978 to decompose each province's growth into various factors. We find that (a) all provinces experienced the slowdown; (b) there is considerable variation in this experience across provinces; (c) national factors dominate the provincial slowdown while province‐specific factors explain most of the interprovincial variation; (d) when the national factor is separated into supply and demand components, the supply component dominates.

Suggested Citation

  • Anping Chen & Nicolaas Groenewold, 2019. "The effects of China’s growth slowdown on its provinces: Disentangling the sources," Growth and Change, Wiley Blackwell, vol. 50(4), pages 1260-1279, December.
    • Handle: RePEc:bla:growch:v:50:y:2019:i:4:p:1260-1279
    DOI: 10.1111/grow.12326
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    More about this item

    JEL classification:

    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • R50 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - General
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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