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Do Political Factors Cause the Regional Inequality in the Reform‐Era China?
Author(s) -
He Qichun
Publication year - 2016
Publication title -
review of development economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.531
H-Index - 50
eISSN - 1467-9361
pISSN - 1363-6669
DOI - 10.1111/rode.12232
Subject(s) - ordinary least squares , economics , per capita , politics , variable (mathematics) , generalized method of moments , china , estimation , variables , inequality , government (linguistics) , instrumental variable , population , development economics , econometrics , panel data , statistics , political science , demography , mathematics , sociology , mathematical analysis , law , linguistics , philosophy , management
We construct a political variable—the number of ministers of all national government departments born in each province weighted by provincial population—to examine its effect on economic growth in China during 1981–2010. We find that the lagged per capita political variable has a significant, positive effect on economic growth in both ordinary least squares ( OLS ) estimation and system generalized method of moments ( GMM ) estimation. We also find that the lagged per capita political variable has a significant, positive effect on financial deregulation policies distributed across provinces, which offers a possible mechanism for the political variable to impact growth.