BOFIT Discussion Papers, Institute for Economies in Transition, Bank of Finland
No 15/2009:
Are there industrial and agricultural convergence clubs in China?
Jenni Pääkkönen ()
Abstract: This paper discusses growth differentials of Chinese
provinces geared to agricultural activities and those focusing on
industrial production over three decades of economic reform. Following
trade theory and endogenous growth theory, we suggest that the fundamental
differences between regions arise from their resource allocations at the
start of reforms. Thus, capital-abundant regions have tended to specialize
in industrial production, while the labor-abundant regions have
concentrated on labor-intensive production (agriculture). Many of China's
agricultural provinces suffer from oversupplies of labor, which has led
large numbers of people to migrate within the country to work in
non-farming sectors of economy. We show that provinces with high shares of
industrial production (the industrial club) have converged, and that
agricultural provinces shifting to industrial production have been catching
up to initially industrialized provinces. Provinces that have stayed with
an agricultural strategy (the agricultural club) show no evidence of
convergence and appear to have been left behind in terms of economic
development.
Keywords: growth; agriculture; convergence; (follow links to similar papers)
JEL-Codes: O17; O40; O57; (follow links to similar papers)
28 pages, October 21, 2009
Before downloading any of the electronic versions below
you should read our statement on
copyright.
Download GhostScript
for viewing Postscript files and the
Acrobat Reader for viewing and printing pdf files.
Full text versions of the paper:
DP1509.pdf 
Download Statistics
Questions (including download problems) about the papers in this series should be directed to Päivi Määttä ()
Report other problems with accessing this service to Sune Karlsson ()
or Helena Lundin ().
Programing by
Design by Joachim Ekebom
