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Testing effects of openness in the process of China's economic growth during 1978-1995

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  • Li, Hong

    (Kingston University London)

Abstract

This paper presents an endogenous growth model in which the growth rate of income is higher if the economy is more open. Openness, measured by the ratios of imports and of foreign direct investment to GDP, is hypothesised to affect economic growth through its impact on technological changes. The hypothesis cannot be rejected with Chinese data at the provincial level for the period 1978-1995 as there is a significantly positive correlation between growth of real GDP per worker and the measures of openness. This paper further tests the robustness of the effect and studies the alternative effects of openness on economic growth.

Suggested Citation

  • Li, Hong, 2000. "Testing effects of openness in the process of China's economic growth during 1978-1995," Economics Discussion Papers 2000-1, School of Economics, Kingston University London.
    • Handle: RePEc:ris:kngedp:2000_001
    as

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    File URL: http://eprints.kingston.ac.uk/6720/1/Li-H-6720.pdf
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    References listed on IDEAS

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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    China; Trade openness; Economic growth;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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