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Centripetal Forces in China's Economic Takeoff

Author

Listed:
  • Anuradha Dayal-Gulati

    (International Monetary Fund)

  • Aasim M. Husain

    (International Monetary Fund)

Abstract

This paper uses provincial time series data from the People's Republic of China to empirically investigate two propositions relating to economic development: (i) that economic takeoff--or an acceleration in economic growth--is associated with inflows of foreign direct investment (FDI), possibly through technological transfer; and (ii) that takeoff is accompanied, at least in the short term, by widening income inequality. The results indicate that FDI flows have increased the rate of convergence in per capita incomes across China's provinces. However, the pattern of FDI, which has gone mainly to the relatively wealthy provinces, has caused different provinces to converge toward different steady states. . Copyright 2002, International Monetary Fund

Suggested Citation

  • Anuradha Dayal-Gulati & Aasim M. Husain, 2002. "Centripetal Forces in China's Economic Takeoff," IMF Staff Papers, Palgrave Macmillan, vol. 49(3), pages 1-4.
    • Handle: RePEc:pal:imfstp:v:49:y:2002:i:3:p:4
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    Citations

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    Cited by:

    1. Andrés Rodríguez-Pose & Roberto Ezcurra, 2010. "Does decentralization matter for regional disparities? A cross-country analysis," Journal of Economic Geography, Oxford University Press, vol. 10(5), pages 619-644, September.
    2. Bulent Unel & Harm Zebregs, 2009. "The Dynamics of Provincial Growth in China: A Nonparametric Approach," IMF Staff Papers, Palgrave Macmillan, vol. 56(2), pages 239-262, June.
    3. repec:zbw:bofitp:2006_012 is not listed on IDEAS
    4. Qiao, Baoyun & Martinez-Vazquez, Jorge & Xu, Yongsheng, 2008. "The tradeoff between growth and equity in decentralization policy: China's experience," Journal of Development Economics, Elsevier, vol. 86(1), pages 112-128, April.
    5. Boyreau-Debray, Genevieve, 2003. "Financial intermediation and growth - Chinese style," Policy Research Working Paper Series 3027, The World Bank.
    6. Shafaeddin, S. M., 2004. "Is China's accession to WTO threatening exports of developing countries?," China Economic Review, Elsevier, vol. 15(2), pages 109-144, January.
    7. Hasan, Iftekhar & Wachtel, Paul & Zhou, Mingming, 2009. "Institutional development, financial deepening and economic growth: Evidence from China," Journal of Banking & Finance, Elsevier, vol. 33(1), pages 157-170, January.
    8. repec:zbw:bofitp:2007_021 is not listed on IDEAS
    9. Lee, Hsiu-Yun & Lin, Kenneth S. & Tsui, Hsiao-Chien, 2009. "Home country effects of foreign direct investment: From a small economy to a large economy," Economic Modelling, Elsevier, vol. 26(5), pages 1121-1128, September.
    10. Hasan, Iftekhar & Wachtel, Paul & Zhou, Mingming, 2009. "Institutional development, financial deepening and economic growth: Evidence from China," Journal of Banking & Finance, Elsevier, vol. 33(1), pages 157-170, January.
    11. Cerra, Valerie & Saxena, Sweta Chaman, 2003. "How responsive is Chinese export supply to market signals?," China Economic Review, Elsevier, vol. 14(3), pages 350-370.
    12. Declan Curran & Michael Funke & Jue Wang, 2007. "Economic Growth across Space and Time: subprovincial Evidence from Mainland China," Quantitative Macroeconomics Working Papers 20710, Hamburg University, Department of Economics.
    13. Roy Bahl & Jorge Martinez-Vazquez, 2003. "Fiscal Federalism and Economic Reform in China," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper0313, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.

    More about this item

    JEL classification:

    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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