New evidence on the role of regional clusters and convergence in China (1952–2008)

Maria Jesus Herrerias () and Javier Ordóñez

China Economic Review, 2012, vol. 23, issue 4, 1120-1133

Abstract: A new panel method is applied to the case of Chinese provinces to analyze the existence of club convergence in terms of per capita income, labor productivity, and capital intensity, from 1952 to 2008. The advantage of this approach is that it takes into account the heterogeneity of Chinese regions in a nonlinear time-varying framework, where more attention is paid to the spatial dimension. This time-varying approach outperforms other methods used in the relevant literature for an economy in transition, such as China, that has undergone a significant transformation over the period under consideration. Our results indicate that Chinese regions have converged into clubs. However, it is observed that Heilongjiang is diverging in terms of labor productivity and capital intensity, while Liaoning and Guizhou display similar patterns in terms of labor productivity, and Shanxi and Hebei in terms of capital intensity. These results indicate that specific economic packages need to be implemented in the clusters that were identified, with special attention to those regions that show a divergence behavior, in order to guarantee the sustainability and equality of regional growth.

Keywords: Endogenous unit root test; Club convergence; Chinese regions (search for similar items in EconPapers)
JEL-codes: C20 O18 O40 R11 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

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Working Paper: New Evidence on the Role of Regional Clusters and Convergence in China (1952-2008) (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:23:y:2012:i:4:p:1120-1133

DOI: 10.1016/j.chieco.2012.08.001

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