Working Papers, Department of Economics, Lund University
Why is Chinese Regional Output Diverging?
(), David Edgerton
() and Sonja Opper
Abstract: In a recent paper Pedroni and Yao (2006) present strong
evidence suggesting that Chinese regional output is diverging, a result
that flies in the face of the current opinion of Chinese policymakers. This
paper provides an in-depth analysis of the reasoning behind this finding.
Our main result is that 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 output
inequalities observed at the regional level are due to both region-specific
disparities and to disparities between clubs of regions.
Keywords: China; Output convergence; Panel unit root tests; Common factor; (follow links to similar papers)
JEL-Codes: C33; O53; R11; (follow links to similar papers)
24 pages, October 29, 2008, Revised December 3, 2008
- This paper is published as:
Westerlund, Joakim, David Edgerton and Sonja Opper, (2010), 'Why is Chinese Provincial Output Diverging?', Journal of Asian Economics, Vol. 21, pages 333-344
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