IDEAS home Printed from https://ideas.repec.org/a/kap/iecepo/v10y2013i4p549-567.html
   My bibliography  Save this article

Special economic zones and growth in China and India: an empirical investigation

Author

Listed:
  • Chee Leong

Abstract

This paper investigates the role of special economic zones (SEZs) in liberalizing the Chinese and Indian economies and their impact on economic growth. The policy change to a more liberalized economy is identified using SEZ variables as instrumental variables. The results indicate that export and FDI growth have positive and statistically significant effects on economic growth in these countries. The presence of SEZs increases regional growth but increasing the number of SEZs has negligible effect on growth. The key to faster economic growth appears to be a greater pace of liberalization. Copyright Springer-Verlag 2013

Suggested Citation

  • Chee Leong, 2013. "Special economic zones and growth in China and India: an empirical investigation," International Economics and Economic Policy, Springer, vol. 10(4), pages 549-567, December.
    • Handle: RePEc:kap:iecepo:v:10:y:2013:i:4:p:549-567
    DOI: 10.1007/s10368-012-0223-6
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s10368-012-0223-6
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s10368-012-0223-6?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Shang-Jin Wei, 1995. "The Open Door Policy and China's Rapid Growth: Evidence from City-Level Data," NBER Chapters, in: Growth Theories in Light of the East Asian Experience, pages 73-104, National Bureau of Economic Research, Inc.
    2. Dollar, David & Kraay, Aart, 2002. "Growth Is Good for the Poor," Journal of Economic Growth, Springer, vol. 7(3), pages 195-225, September.
    3. Joshua J. Lewer & Hendrik Van den Berg, 2003. "How Large Is International Trade’s Effect on Economic Growth?," Journal of Economic Surveys, Wiley Blackwell, vol. 17(3), pages 363-396, July.
    4. Aradhna Aggarwal, 2004. "Export processing zones in India: Analysis of the export performance," Indian Council for Research on International Economic Relations, New Delhi Working Papers 148, Indian Council for Research on International Economic Relations, New Delhi, India.
    5. Hamada, Koichi, 1974. "An economic analysis of the duty-free zone," Journal of International Economics, Elsevier, vol. 4(3), pages 225-241, August.
    6. David H. Romer & Jeffrey A. Frankel, 1999. "Does Trade Cause Growth?," American Economic Review, American Economic Association, vol. 89(3), pages 379-399, June.
    7. Hausman, Jerry, 2015. "Specification tests in econometrics," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 38(2), pages 112-134.
    8. Edward M. Graham, 2004. "Do export processing zones attract FDI and its benefits," International Economics and Economic Policy, Springer, vol. 1(1), pages 87-103, March.
    9. Young, Leslie & Miyagiwa, Kaz F., 1987. "Unemployment and the formation of duty-free zones," Journal of Development Economics, Elsevier, vol. 26(2), pages 397-405, August.
    10. Madani, Dorsati, 1999. "A review of the role and impact of export processing zones," Policy Research Working Paper Series 2238, The World Bank.
    11. Alan D. Woodland (ed.), 2002. "Economic Theory and International Trade," Books, Edward Elgar Publishing, number 1994.
    12. Barry Bosworth & Susan M. Collins, 2008. "Accounting for Growth: Comparing China and India," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 45-66, Winter.
    13. World Bank, 2009. "World Development Indicators 2009," World Bank Publications - Books, The World Bank Group, number 4367.
    14. Douglas Zhihua Zeng, 2010. "Building Engines for Growth and Competitiveness in China : Experience with Special Economic Zones and Industrial Clusters," World Bank Publications - Books, The World Bank Group, number 2501.
    15. David Dollar & Aart Kraay, 2004. "Trade, Growth, and Poverty," Economic Journal, Royal Economic Society, vol. 114(493), pages 22-49, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Tomasz Brodzicki, 2017. "The Role of Openness in Regional Economic Growth. The Case of Polish and Spanish NUTS-2 Regions," Collegium of Economic Analysis Annals, Warsaw School of Economics, Collegium of Economic Analysis, issue 47, pages 43-64.
    2. Alkon, Meir, 2018. "Do special economic zones induce developmental spillovers? Evidence from India’s states," World Development, Elsevier, vol. 107(C), pages 396-409.
    3. Hanna Godlewska-Majkowska & Agnieszka Komor & Magdalena Typa, 2016. "Special Economic Zones as Growth and Anti-growth Poles as Exemplified by Polish Regions," Entrepreneurial Business and Economics Review, Centre for Strategic and International Entrepreneurship at the Cracow University of Economics., vol. 4(4), pages 189-212.
    4. Ronald B. Davies & Rodolphe Desbordes, 2018. "Export Processing Zones and the Composition of Greenfield FDI," Working Papers 201807, School of Economics, University College Dublin.
    5. Kuo‐Cheng Kuo & Wen‐Min Lu & Dinh Tam Nguyen & Hsiu Fei Wang, 2020. "The effect of special economic zones on governance performance and their spillover effects in Chinese provinces," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 41(3), pages 446-460, April.
    6. Muhammad Adnan & Baohua Xiao & Shaheen Bibi & Peiwen Xiao & Peng Zhao & Haiyan Wang & Muhammad Ubaid Ali & Xianjin An, 2024. "Known and Unknown Environmental Impacts Related to Climate Changes in Pakistan: An Under-Recognized Risk to Local Communities," Sustainability, MDPI, vol. 16(14), pages 1-27, July.
    7. Yuneng Jiang & Yi Zhu & Yasi Tian, 2023. "Measuring the Urban Sprawl of a Mega-Urban Agglomeration Area Based on Multi-Dimensions with a Mechanical Equilibrium Model: A Case Study of the Yangtze River Delta, China," Land, MDPI, vol. 12(8), pages 1-22, August.
    8. Sina Hardaker, 2020. "Embedded Enclaves? Initial Implications of Development of Special Economic Zones in Myanmar," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 32(2), pages 404-430, April.
    9. Rahul Panat, 2014. "On the data and analysis of the research output of India and China: India has significantly fallen behind China," Scientometrics, Springer;Akadémiai Kiadó, vol. 100(2), pages 471-481, August.
    10. Chunying Cui & Dengke He & Ziwei Yan, 2023. "The Environment–Economy Synergistic Improvement Effect of the “Two-Oriented Society” Pilot Area in China," IJERPH, MDPI, vol. 20(1), pages 1-23, January.
    11. Susanne Frick & Andrés Rodríguez-Pose, . "Are special economic zones in emerging countries a catalyst for the growth of surrounding areas?," UNCTAD Transnational Corporations Journal, United Nations Conference on Trade and Development.
    12. Soniya Falahatdoost & Xingping Wang, 2022. "Industrial Park Role as a Catalyst for Regional Development: Zooming on Middle East Countries," Land, MDPI, vol. 11(8), pages 1-18, August.
    13. Lotta Moberg & Vlad Tarko, 2021. "Special economic zones and liberalization avalanches," Journal of Entrepreneurship and Public Policy, Emerald Group Publishing Limited, vol. 10(1), pages 120-139, February.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wei, Shang-Jin & Wu, Yi, 2001. "Globalization and Inequality: Evidence from within China," CEPR Discussion Papers 3088, C.E.P.R. Discussion Papers.
    2. Walker Wright, 2020. "How trade openness can help to ‘deliver the poor and needy’," Economic Affairs, Wiley Blackwell, vol. 40(1), pages 100-107, February.
    3. Philippe Aghion & Robin Burgess & Stephen J. Redding & Fabrizio Zilibotti, 2008. "The Unequal Effects of Liberalization: Evidence from Dismantling the License Raj in India," American Economic Review, American Economic Association, vol. 98(4), pages 1397-1412, September.
    4. Miet Maertens & Liesbeth Colen & Johan F. M. Swinnen, 2011. "Globalisation and poverty in Senegal: a worst case scenario?," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 38(1), pages 31-54, March.
    5. Montalbano, Pierluigi, 2011. "Trade Openness and Developing Countries' Vulnerability: Concepts, Misconceptions, and Directions for Research," World Development, Elsevier, vol. 39(9), pages 1489-1502, September.
    6. Jorge Martinez-Vazquez & Violeta Vulovic & Yongzheng Liu, 2011. "Direct versus Indirect Taxation: Trends, Theory, and Economic Significance," Chapters, in: Emilio Albi & Jorge Martinez-Vazquez (ed.), The Elgar Guide to Tax Systems, chapter 2, Edward Elgar Publishing.
    7. Brandt, Loren & Li, Bingjing & Morrow, Peter M., 2021. "Processing trade and costs of incomplete liberalization: The case of China," Journal of International Economics, Elsevier, vol. 131(C).
    8. Asma Boussetta, 2022. "Microfinance, Poverty and Education," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 64(1), pages 86-108, March.
    9. Stimpfle, Alexander & Stadelmann, David, 2015. "The Impact of Fundamental Development Factors on Different Income Groups: International Evidence," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113128, Verein für Socialpolitik / German Economic Association.
    10. Timothy J. Kehoe & Kim J. Ruhl, 2010. "Why Have Economic Reforms in Mexico Not Generated Growth?," Journal of Economic Literature, American Economic Association, vol. 48(4), pages 1005-1027, December.
    11. Andrew Sumner & Meera Tiwari, 2005. "Poverty and economic policy: what happens when researchers disagree?," Journal of International Development, John Wiley & Sons, Ltd., vol. 17(6), pages 791-801.
    12. Chen,Derek Hung Chiat & Ranaweera,Thilakaratna & Storozhuk, Andriy, 2004. "The RMSM-S+P : a minimal poverty module for the RMSM-X," Policy Research Working Paper Series 3304, The World Bank.
    13. Ali Abdel Gadir Ali, "undated". "Globalization and Inequality in the Arab Region," API-Working Paper Series 0307, Arab Planning Institute - Kuwait, Information Center.
    14. Fabrizio Carmignani, 2011. "The Making of Pro‐Poor Growth," Scottish Journal of Political Economy, Scottish Economic Society, vol. 58(5), pages 656-684, November.
    15. Dawood MAMOON, 2017. "Agriculture or industry: Rice or garments: Ex-post and ex-ante analysis of Pakistan’s falling competitiveness in its main export items," Journal of Economics Bibliography, KSP Journals, vol. 4(3), pages 249-255, September.
    16. M. Maqbool-ur-Rahman, 2015. "Impacts Of Globalization On Economic Growth - Evidence From Selected South Asian Countries," Journal of Management Sciences, Geist Science, Iqra University, Faculty of Business Administration, vol. 2(1), pages 185-204, March.
    17. Guerriero, Marta & Sen, Kunal, 2012. "What Determines the Share of Labour in National Income? A Cross-Country Analysis," IZA Discussion Papers 6643, Institute of Labor Economics (IZA).
    18. Quaicoe, Alexander & Aboagye, Anthony Q.Q. & Bokpin, Godfred A., 2017. "Assessing the impact of export processing zones on economic growth in Ghana," Research in International Business and Finance, Elsevier, vol. 42(C), pages 1150-1163.
    19. Loayza, Norman V. & Soto, Raimundo, 2004. "On the measurement of market-oriented reforms," Policy Research Working Paper Series 3371, The World Bank.
    20. Sumbal Fatima & Bateer Chen & Muhammad Ramzan & Qamar Abbas, 2020. "The Nexus Between Trade Openness and GDP Growth: Analyzing the Role of Human Capital Accumulation," SAGE Open, , vol. 10(4), pages 21582440209, November.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:iecepo:v:10:y:2013:i:4:p:549-567. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.