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Intra-Provincial Financial Disparity, Economic Disparity, and Regional Development in China: Evidence from Prefecture-Level City Data

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  • Ke Zou
  • Jing He

Abstract

The uneven spatial distribution of economic and financial activities in China has long been a concern of both researchers and policy makers. While most previous research focuses on China’s regional disparities measured using provincial data, this article investigates intra-provincial disparities which reflect the dispersion among cities within a given province. Using data on 282 prefecture-level cities in 25 provinces from 2003 to 2012, the relationship between economic disparity and financial disparity is investigated, after which the effects of the intra-provincial disparities on provincial economic growth are examined. It is found that intra-provincial financial disparity and economic disparity are positively correlated. The results also show that intra-provincial economic disparity has no effect on provincial economic growth. The intra-provincial financial disparity, however, has a negative effect on the local economic growth rate. Therefore, developing financial inclusion and narrowing financial disparity are important measures to maintain sustainable and inclusive economic growth.

Suggested Citation

  • Ke Zou & Jing He, 2018. "Intra-Provincial Financial Disparity, Economic Disparity, and Regional Development in China: Evidence from Prefecture-Level City Data," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 54(13), pages 3064-3080, October.
  • Handle: RePEc:mes:emfitr:v:54:y:2018:i:13:p:3064-3080
    DOI: 10.1080/1540496X.2017.1364236
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    Cited by:

    1. Suwan Lu & Guobin Fang & Mingtao Zhao, 2023. "Towards Inclusive Growth: Perspective of Regional Spatial Correlation Network in China," Sustainability, MDPI, vol. 15(7), pages 1-19, March.
    2. Feng, Lingbing & Fu, Tong & Kutan, Ali M., 2019. "Can government intervention be both a curse and a blessing? Evidence from China's finance sector," International Review of Financial Analysis, Elsevier, vol. 61(C), pages 71-81.
    3. Ding, Guoxuan & Kang, Nier, 2024. "The impact of digital financial inclusion on China's regional disparities in the quality of economic development: Based on the relational data paradigm," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 629-651.

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