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Globalisation and the provinces of China: the role of domestic versus international trade integration

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  • Arne Melchior

Abstract

Regional disparities are particularly high in some larger emerging economies, such as Russia and China, and inter-provincial inequality in China has increased rapidly after 1990. In the literature, a statistical link between globalisation and increased regional disparities in China has been established, but not the precise mechanisms and causal relationships. In the paper, we therefore simulate a world trade model with 166 countries and regions in order to shed light on these mechanisms and the future development of regional disparities in China. Our results suggest that the faster growth in coastal regions may be caused by the role of these regions as transport hubs for international trade. However, uneven growth could also be caused by domestic trade disintegration, as suggested by some other research. In the paper, we demonstrate these mechanisms, but we are not able to draw firm conclusions about the relative role each of them play empirically. The weaker development for some peripheral regions can be reversed by stronger domestic trade integration or better cross-border infrastructure.

Suggested Citation

  • Arne Melchior, 2010. "Globalisation and the provinces of China: the role of domestic versus international trade integration," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 8(3), pages 227-252.
    • Handle: RePEc:taf:jocebs:v:8:y:2010:i:3:p:227-252
    DOI: 10.1080/14765284.2010.493639
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    References listed on IDEAS

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    1. André Sapir & Richard Baldwin & Daniel Cohen & Anthony Venables, 1999. "Market integration, regionalism and the global economy," ULB Institutional Repository 2013/8074, ULB -- Universite Libre de Bruxelles.
    2. Caselli, Francesco, 2005. "Accounting for Cross-Country Income Differences," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 9, pages 679-741, Elsevier.
    3. Head, Keith & Mayer, Thierry, 2004. "The empirics of agglomeration and trade," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 59, pages 2609-2669, Elsevier.
    4. repec:hal:wpspec:info:hdl:2441/10191 is not listed on IDEAS
    5. Caselli, Francesco, 2005. "Accounting for cross-country income differences," LSE Research Online Documents on Economics 5266, London School of Economics and Political Science, LSE Library.
    6. Ottaviano, Gianmarco & Thisse, Jacques-Francois, 2004. "Agglomeration and economic geography," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 58, pages 2563-2608, Elsevier.
    7. repec:hal:spmain:info:hdl:2441/10191 is not listed on IDEAS
    8. Caselli, Francesco, 2005. "Accounting for cross-country income differences," LSE Research Online Documents on Economics 3567, London School of Economics and Political Science, LSE Library.
    9. Baldwin,Richard & Cohen,Daniel & Sapir,Andre & Venables,Anthony (ed.), 1999. "Market Integration, Regionalism and the Global Economy," Cambridge Books, Cambridge University Press, number 9780521645898, October.
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    Cited by:

    1. David A. Ralston & Carolyn P. Egri & Charlotte M. Karam & Yongjuan Li & Ping Ping Fu, 2018. "Changes in work values across the regions of China," Asia Pacific Journal of Management, Springer, vol. 35(1), pages 145-179, March.
    2. Tsun Se Cheong & Yanrui Wu, 2013. "Globalization and Regional Inequality," Economics Discussion / Working Papers 13-10, The University of Western Australia, Department of Economics.
    3. Hazwan Haini & Pang Wei Loon, 2022. "Information Communication Technologies, Globalisation and Growth: Evidence from the ASEAN Economies," Economic Papers, The Economic Society of Australia, vol. 41(1), pages 34-53, March.
    4. S. S. Lachininskii & A. S. Lachininskii & I. V. Semenova, 2016. "The geoeconomic factor in shaping the spatial pattern of St. Petersburg’s coastal area," Regional Research of Russia, Springer, vol. 6(4), pages 323-331, October.

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