Financial openness and Chinese regional growth imbalance: New insight from spatial spillovers

Shenguo Yuan and Zhouheng Wu

The North American Journal of Economics and Finance, 2021, vol. 57, issue C

Abstract: This paper uses spatial panel methods and Chinese provincial data from 2003 to 2017 to study the spatial spillovers of financial openness on economic growth. The results show, first, a positive direct effect and an overall negative spatial spillover of financial openness on provincial growth. Second, there are two spatial spillover channels: a positive growth externality and a harmful resource competition among provinces. Third, we estimate the state dependence and dynamics of spatial spillover, and find that the negative spatial spillover is smaller in provinces with high levels of financial openness and in the long term; thus, the negative spatial spillover declined over time. These results are robust to the choice of SDM and GNS spatial econometrics methods and under different spatial weight matrices.

Keywords: Financial openness; Regional growth imbalance; Spatial spillover; Resource competition (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecofin:v:57:y:2021:i:c:s1062940821000644

DOI: 10.1016/j.najef.2021.101435

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