Cumulative causation and inequality among villages in China
John Knight and
Shi Li ()
Oxford Development Studies, 1997, vol. 25, issue 2, 149-172
Abstract:
Why are villages that are geographically so close together economically so far apart? This question is examined using a survey of 1000 households in seven villages in Hebei province, China. An answer is developed in terms of factor immobility and processes of cumulative causation. Although a good natural resource endowment helps to initiate the process, the main cause of differential village development is non-farm sources of income: migration and village industry. Both are constrained and the easing of the constraints involves path-dependent cumulative processes. For instance, migration requires a village network of information and contacts, and village industrialization depends on the accumulation of local skills through a process of learning-by-doing and on the reinvestment of profits. There is a case for mesoeconomic analysis at the village level in China and in other poor countries.
Date: 1997
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Working Paper: Cumulative Causation and Inequality Among Villages in China (1996)
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DOI: 10.1080/13600819708424127
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