Interregional productivity variations in Chinese manufacturing and mining industry

Abstract

A shift-share model is employed to analyse the interregional productivity variations in Chinese manufacturing and mining industry. Our empirical results show that sector productivity difference is huge; surprisingly, the most productive coastal regions are found to be specialized in low-productive sectors; the inland provinces suffer a uniform productivity lag, which suggests policies geared to increase regional productivity, such as infrastructures and human capital, are crucial to close the productivity gap between the inland and the costal.

Acknowledgement

I would like to thank Robert A. Margo and Chun-Yu Ho for their help and comments.

Notes

¹ The regional division of mainland China in our article might not be strictly according to the geography. Western region is comprised of 12 provinces which are selected into the Plan of Western Region Development launched by China government in 1999: Chongqing, Sichuan, Yunnan, Tibet, Shanxi, Gansu, Qinghai, Ningxia, Xinjiang, Inner Mongolia, Guangxi, Guizhou. Eastern region includes Heilongjiang, Jilin, Liaoning, Tianjin, Beijing, Shandong, Jiangsu, Shanghai, Zhejiang, Fujian, Guangdong and Hainan. The rest of eight provinces belong to Central region.