Spatial spillover and regional economic growth in China

Chong-En Bai, Hong Ma and Wenqing Pan

China Economic Review, 2012, vol. 23, issue 4, 982-990

Abstract: This paper investigates the spatial structure of the provincial economic growth and the spatial spillover in China from 1998 to 2008. First, we apply Moran's index to detect the positive spatial autocorrelations across the provinces of China. Second, we build a new economic geography model and the role of market potential in promoting regional income growth is highlighted. Third, two measures of market potential are constructed and a spatial error model is adopted to obtain the estimations, considering spatial autocorrelation. Controlling for major inputs, such as labor, capital, and human capital, the market potential continues to promote substantial regional growth. On average, an increase of 10 percentage points in the market potential increases the regional GDP per capita growth by 3–5 percentage points.

Keywords: Spatial spillover; Regional economic growth; Market potential (search for similar items in EconPapers)
JEL-codes: F12 F15 R11 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (43)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:23:y:2012:i:4:p:982-990

DOI: 10.1016/j.chieco.2012.04.016

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