IDEAS home Printed from https://ideas.repec.org/a/pal/palcom/v9y2022i1d10.1057_s41599-022-01315-0.html
   My bibliography  Save this article

Convergence effect of the Belt and Road Initiative on income disparity: evidence from China

Author

Listed:
  • Bo Qin

    (Guangxi University)

  • Dongmei Zeng

    (Guangxi University)

  • Angang Gao

    (Guangxi University of Science and Technology)

Abstract

The international economic effects of the Belt and Road Initiative (BRI) have received much attention, but few studies have focused on the impact of the BRI on domestic regional income disparities. Here, a theoretical framework is proposed based on the logic of public policy analysis in economic geography aiming at studying the impact of the BRI on the convergence of inter-city income disparities in China. Specifically, taking the BRI as a quasi-natural experiment, the impact of the BRI on the convergence of inter-city income disparities in 26 provinces of China is studied empirically using the difference-in-differences method. We find that the BRI has indeed contributed to the convergence of regional income disparities, and this convergence effect is continuously dynamic in its nature. The effects of trade opening and industrial structure transformation are the paths through which the BRI contributes to the convergence of income disparities. Furthermore, we find that there is significant heterogeneity in the effects of the BRI on the convergence of income disparities among cities in different provinces in China. The convergence effect of the BRI on the income disparities among cities in East China is small and insignificant, whereas it can significantly reduce the income disparities among cities in Central and West China. The research in this article has important application value for exploration of the regional income distribution effect of the BRI.

Suggested Citation

  • Bo Qin & Dongmei Zeng & Angang Gao, 2022. "Convergence effect of the Belt and Road Initiative on income disparity: evidence from China," Palgrave Communications, Palgrave Macmillan, vol. 9(1), pages 1-16, December.
    • Handle: RePEc:pal:palcom:v:9:y:2022:i:1:d:10.1057_s41599-022-01315-0
    DOI: 10.1057/s41599-022-01315-0
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1057/s41599-022-01315-0
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1057/s41599-022-01315-0?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. Reto Foellmi & Josef Zweimüller, 2017. "Is inequality harmful for innovation and growth? Price versus market size effects," Journal of Evolutionary Economics, Springer, vol. 27(2), pages 359-378, April.
    2. Boucekkine, R. & Camacho, C. & Fabbri, G., 2013. "Spatial dynamics and convergence: The spatial AK model," Journal of Economic Theory, Elsevier, vol. 148(6), pages 2719-2736.
    3. Celeste, Roger Keller & Nadanovsky, Paulo, 2010. "How much of the income inequality effect can be explained by public policy? Evidence from oral health in Brazil," Health Policy, Elsevier, vol. 97(2-3), pages 250-258, October.
    4. Craig Garthwaite & Tal Gross & Matthew J. Notowidigdo, 2014. "Public Health Insurance, Labor Supply, and Employment Lock," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(2), pages 653-696.
    5. Thorsten Beck & Ross Levine & Alexey Levkov, 2010. "Big Bad Banks? The Winners and Losers from Bank Deregulation in the United States," Journal of Finance, American Finance Association, vol. 65(5), pages 1637-1667, October.
    6. Bird, Julia & Lebrand, Mathilde & Venables, Anthony J., 2020. "The Belt and Road Initiative: Reshaping economic geography in Central Asia?," Journal of Development Economics, Elsevier, vol. 144(C).
    7. George J. Borjas & Richard B. Freeman & Lawrence F. Katz, 2021. "How Much Do Immigration and Trade Affect Labor Market Outcomes?," World Scientific Book Chapters, in: Foundational Essays in Immigration Economics, chapter 8, pages 163-234, World Scientific Publishing Co. Pte. Ltd..
    8. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-499, June.
    9. Wood, Adrian, 1998. "Globalisation and the Rise in Labour Market Inequalities," Economic Journal, Royal Economic Society, vol. 108(450), pages 1463-1482, September.
    10. Shorrocks, A F, 1982. "Inequality Decomposition by Factor Components," Econometrica, Econometric Society, vol. 50(1), pages 193-211, January.
    11. Matias Busso & Jesse Gregory & Patrick Kline, 2013. "Assessing the Incidence and Efficiency of a Prominent Place Based Policy," American Economic Review, American Economic Association, vol. 103(2), pages 897-947, April.
    12. Wolfgang F. Stolper & Paul A. Samuelson, 1941. "Protection and Real Wages," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 9(1), pages 58-73.
    13. Max Roser & Jesus Crespo Cuaresma, 2016. "Why is Income Inequality Increasing in the Developed World?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 62(1), pages 1-27, March.
    14. Florian Dorn & Clemens Fuest & Niklas Potrafke, 2022. "Trade openness and income inequality: New empirical evidence," Economic Inquiry, Western Economic Association International, vol. 60(1), pages 202-223, January.
    15. Persson, Torsten & Tabellini, Guido, 1994. "Is Inequality Harmful for Growth?," American Economic Review, American Economic Association, vol. 84(3), pages 600-621, June.
    16. Florence Jaumotte & Subir Lall & Chris Papageorgiou, 2013. "Rising Income Inequality: Technology, or Trade and Financial Globalization?," IMF Economic Review, Palgrave Macmillan;International Monetary Fund, vol. 61(2), pages 271-309, June.
    17. Lars Osberg & Kuan Xu, 2000. "International Comparisons of Poverty Intensity: Index Decomposition and Bootstrap Inference," Journal of Human Resources, University of Wisconsin Press, vol. 35(1), pages 51-81.
    18. Hannum, Emily & Wang, Meiyan, 2006. "Geography and educational inequality in China," China Economic Review, Elsevier, vol. 17(3), pages 253-265.
    19. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 407-437.
    20. Douglas Staiger & James H. Stock, 1997. "Instrumental Variables Regression with Weak Instruments," Econometrica, Econometric Society, vol. 65(3), pages 557-586, May.
    21. Michael R. Betz & Mark D. Partridge, 2013. "Country Road Take Me Home," International Regional Science Review, , vol. 36(3), pages 267-295, July.
    22. Kevin Sylwester, 2003. "Enrolment in Higher Education and Changes in Income Inequality," Bulletin of Economic Research, Wiley Blackwell, vol. 55(3), pages 249-262, July.
    23. Asteriou, Dimitrios & Dimelis, Sophia & Moudatsou, Argiro, 2014. "Globalization and income inequality: A panel data econometric approach for the EU27 countries," Economic Modelling, Elsevier, vol. 36(C), pages 592-599.
    24. Elder, Erick & Holland, Larry, 2000. "Social Security reform: the effect of investing in equities," Financial Services Review, Elsevier, vol. 9(1), pages 93-106, 00.
    25. Takahiro Akita & Sachiko Miyata, 2010. "The bi-dimensional decomposition of regional inequality based on the weighted coefficient of variation," Letters in Spatial and Resource Sciences, Springer, vol. 3(3), pages 91-100, October.
    26. Dagum, Camilo, 1997. "A New Approach to the Decomposition of the Gini Income Inequality Ratio," Empirical Economics, Springer, vol. 22(4), pages 515-531.
    27. Arjun Jayadev, 2007. "Capital account openness and the labour share of income," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 31(3), pages 423-443, May.
    28. Ma, Shengnan, 2022. "Growth effects of economic integration: New evidence from the Belt and Road Initiative," Economic Analysis and Policy, Elsevier, vol. 73(C), pages 753-767.
    29. Luc Anselin, 2010. "Thirty years of spatial econometrics," Papers in Regional Science, Wiley Blackwell, vol. 89(1), pages 3-25, March.
    30. Stark, Oded & Micevska, Maja & Mycielski, Jerzy, 2009. "Relative poverty as a determinant of migration: Evidence from Poland," Economics Letters, Elsevier, vol. 103(3), pages 119-122, June.
    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. Fei Wang & Zhi Dong & Jichang Dong, 2023. "Assessment of the Drivers and Effects of International Science and Technology Cooperation in Xinjiang in the Context of the Belt and Road Initiative," Sustainability, MDPI, vol. 15(2), pages 1-20, January.
    2. Xin Su & Shengwen Wang, 2024. "Impact of China’s free trade zones on the innovation performance of firms: evidence from a quasi-natural experiment," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-17, December.

    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. Saha, Anjan K. & Mishra, Vinod, 2020. "Genetic distance, economic growth and top income shares: Evidence from OECD countries," Economic Modelling, Elsevier, vol. 92(C), pages 37-47.
    2. Philipp Heimberger, 2019. "Beeinflusst die ökonomische Globalisierung die Einkommensungleichheit? Eine Meta-Analyse," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 45(4), pages 497-529.
    3. Florian Dorn & Clemens Fuest & Niklas Potrafke, 2022. "Trade openness and income inequality: New empirical evidence," Economic Inquiry, Western Economic Association International, vol. 60(1), pages 202-223, January.
    4. Philipp Heimberger, 2020. "Does economic globalisation affect income inequality? A meta‐analysis," The World Economy, Wiley Blackwell, vol. 43(11), pages 2960-2982, November.
    5. Muhammed Ashiq Villanthenkodath & Shreya Pal & Mantu Kumar Mahalik, 2024. "Income Inequality in Globalization Context: Evidence from Global Data," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(1), pages 3872-3902, March.
    6. Gries, T. & Grundmann, R. & Palnau, I. & Redlin, M., 2015. "Does technological change drive inclusive industrialization? : A review of major concepts and findings," MERIT Working Papers 2015-044, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    7. Vincent Leyaro, 2015. "Threshold and interaction effects in the trade, growth, and inequality relationship," WIDER Working Paper Series 009, World Institute for Development Economic Research (UNU-WIDER).
    8. Dani Rodrik, 2018. "Populism and the economics of globalization," Journal of International Business Policy, Palgrave Macmillan, vol. 1(1), pages 12-33, June.
    9. T. Gries & R. Grundmann & I. Palnau & M. Redlin, 2017. "Innovations, growth and participation in advanced economies - a review of major concepts and findings," International Economics and Economic Policy, Springer, vol. 14(2), pages 293-351, April.
    10. Gangfei Luo & Shouzhen Zeng & Tomas Baležentis, 2022. "Multidimensional Measurement and Comparison of China’s Educational Inequality," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 163(2), pages 857-874, September.
    11. Zhenhua Chen & Laurie A. Schintler, 2023. "Rediscovering regional science: Positioning the field's evolving location in science and society," Journal of Regional Science, Wiley Blackwell, vol. 63(3), pages 617-642, June.
    12. Hrushikesh Mallick & Mantu Kumar Mahalik & Hemachandra Padhan, 2020. "Does globalization exacerbate income inequality in two largest emerging economies? The role of FDI and remittances inflows," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 67(4), pages 443-480, December.
    13. Clem Tisdell & Serge Svizzero, 2004. "Globalization, Social Welfare, Public Policy And Labor Inequalities," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 49(02), pages 233-253.
    14. Walter Hyll, 2017. "Gender Quotas and Human Capital Formation: A Relative Deprivation Approach," German Economic Review, Verein für Socialpolitik, vol. 18(3), pages 302-326, August.
    15. 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.
    16. Marques, André M., 2022. "Is income inequality good or bad for growth? Further empirical evidence using data for all Brazilian cities," Structural Change and Economic Dynamics, Elsevier, vol. 62(C), pages 360-376.
    17. Chu, Lan Khanh & Hoang, Dung Phuong, 2020. "How does economic complexity influence income inequality? New evidence from international data," Economic Analysis and Policy, Elsevier, vol. 68(C), pages 44-57.
    18. Erauskin, Iñaki & Turnovsky, Stephen J., 2022. "International financial integration, the level of development, and income inequality: Some empirical evidence," International Review of Economics & Finance, Elsevier, vol. 82(C), pages 48-64.
    19. Achten, Sandra & Lessmann, Christian, 2020. "Spatial inequality, geography and economic activity," World Development, Elsevier, vol. 136(C).
    20. Easterly, William, 2007. "Inequality does cause underdevelopment: Insights from a new instrument," Journal of Development Economics, Elsevier, vol. 84(2), pages 755-776, November.

    More about this item

    Statistics

    Access and download statistics

    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:pal:palcom:v:9:y:2022:i:1:d:10.1057_s41599-022-01315-0. 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: https://www.nature.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.