Why is Chinese provincial output diverging?

Joakim Westerlund, David Edgerton and Sonja Opper

Journal of Asian Economics, 2010, vol. 21, issue 4, 333-344

Abstract: In a recent paper Pedroni and Yao (2006) present strong evidence suggesting that Chinese provincial per-capita output is diverging, a result that goes against the Chinese government's goal of a balanced wealth-creation across provinces. This paper provides an in-depth analysis of the reasoning behind this finding. Our main result is that the divergence does exist, even when new data and more advanced methods of analysis are used. We also find that it has both an idiosyncratic and a common component. Hence, the increased per-capita output inequalities observed at the provincial level is due to both province-specific disparities and to disparities between groups of provinces.

Keywords: China; Output; convergence; Panel; unit; root; tests; Common; factor (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:asieco:v:21:y:2010:i:4:p:333-344

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