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Do border effects alter regional development: evidence from a quasi-natural experiment in China

Author

Listed:
  • Benjian Yang
  • Mark D Partridge
  • Anping Chen

Abstract

Market access/potential is main explanations for spatial variation in economic activity. Past research has used quasi-natural experiments such as the imposition and removal of the Iron Curtain to assess how changes in market access influence economic outcomes. Rather, we focus on key quantity effects of market access by tracking population changes induced by the creation of a subnational border. We exploit a quasi-natural experiment in China and use a difference-in-difference identification strategy to estimate the effects of introducing a new border when Sichuan province was split into Chongqing and Sichuan in 1997. We find that the new border had negative population effects on Sichuan counties located near the new border. Further investigation finds that such border effects are unique to the new border region and are not related to other factors such as being more rural. We also provide additional evidence to exclude alternative explanations including differences in industry composition or access to transportation.

Suggested Citation

  • Benjian Yang & Mark D Partridge & Anping Chen, 2022. "Do border effects alter regional development: evidence from a quasi-natural experiment in China," Journal of Economic Geography, Oxford University Press, vol. 22(1), pages 103-127.
    • Handle: RePEc:oup:jecgeo:v:22:y:2022:i:1:p:103-127.
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    File URL: http://hdl.handle.net/10.1093/jeg/lbaa018
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    Citations

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    Cited by:

    1. Zhang, Hong & Wei, Xin, 2022. "Border effects within a city and regional coordinated development in emerging economies," Finance Research Letters, Elsevier, vol. 50(C).
    2. Fernihough, Alan, 2024. "Economic Geography and the Irish Border: A Market Access Approach," QBS Working Paper Series 2024/02, Queen's University Belfast, Queen's Business School.
    3. Qiliang, Mao & Xianzhuang, Mao, 2024. "The shaping of inter-regional industrial linkages by institutional and cultural division in China: Characteristics and differences," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 1113-1132.

    More about this item

    Keywords

    Border effects; regional competition; market access; quasi-natural experiment; China;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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