Centripetal forces in China's Economic Take-Off

By Anuradha Dayal-Gulati, Aasim M. Husain

May 1, 2000

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Anuradha Dayal-Gulati, and Aasim M. Husain Centripetal forces in China's Economic Take-Off, (USA: International Monetary Fund, 2000) accessed November 12, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper uses provincial time series data from China to empirically investigate two propositions relating to economic development: (i) that economic takeoff is associated with technological transfer through foreign direct investment (FDI); and (ii) that takeoff is accompanied, at least in the short term, by widening income inequality. The results indicate that FDI flows have increased the rate of convergence in per capita incomes across China’s provinces. However, the pattern of FDI, which has gone mainly to the relatively wealthy provinces, has caused different provinces to converge to different steady states.

Subject: Agricultural sector, Balance of payments, Bank credit, Economic sectors, Expenditure, Foreign direct investment, Money, National accounts, Personal income

Keywords: Agricultural sector, Bank credit, China, Convergence, Convergence coefficient, Estimate, Estimation result, Europe, FDI flow, FDI inflow, FDI variable, Foreign direct investment, GDP, Growth, Growth performance, Inequality, Integration, Personal income, Population estimate, State enterprise, WP

Publication Details

Pages:

36
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2000/086
Stock No:

WPIEA0862000
ISBN:

9781451850871
ISSN:

1018-5941

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