The Study On Technology Diffusion And Regional Economic Convergence In China

Economic growth Convergence theory has become one of the most popular subjects in economic growth theories since the 1980s. The core of the subject is to study the difference of economic growth between different economies or different regions in a county and look for the the causes of these differences. For China, a large number of regions and the economic gap between different regions expanding significantly, the topic appear to be particularly realistic. The economic gap has become expand or narrow can be firstly attributed to the regional different rate of economic growth. Although there are a lot of research on China's regional economic disparities, quite a few research analyzed using convergence theory, there seldom involved in the technology-diffusion-based research perspective. On the basis of existed research, this paper studies technology diffusion and regional economic growth convergence in China from a new perspective. In the theoretical side, according to the convergence research in the Neo-Classical Theory of Economic Growth and New Growth Theory, this paper studies influence of technical diffusion on the diversity of regional economic growth in China, Which widenes the scope of the convergence study. In the method, this paper constructs a new model to study regional economic growth convergence and estimated by means of Panel Data procedures and data on the Chinese regions over the 1981-2005 periods.Based on the historical studies of difference in Chinese regional economies growth, economic structure correlation hypothesis of technical diffusion is proposed. Technical progress is broken down into four parts: (1) constant term p is here let to reflect the effects of "country-wide" technical progress and of all the factors that influence the effectiveness of labour in all regions contemporaneously; (2) region-specific component of technical progress; (3) technical diffusion; (4) random shock. Using the "spatial econometric perspective" approach, this paper proposes a theoreticl framework and derives an "extended" convergence equation. The implication of our model is that, if technological diffusion is of an intra-sector type, economies' structural differences need to be taken account of as an additional factor on which convergence is conditional. In other words, anumber of economies, identical in all other respects, will still not be subject toβ-convergence, unless they are as structurally similar as to share the same technology.Based on the theoretical analysis, this paper estimates the convergence from two aspects of the convergence mechanisms and outputs. Empirical studies indicate that China's regional economic growth exist weak conditional convergence and the "convergence club" evidence over the 1981-2005 periods, but the convergence rate in different Five-year Plan fluctuates. The technical diffusion has the remarkable influence to the economic growth convergence, but it is significantly difference in different region at different time. The results bring empirical support to our approach.Finally, this paper constructes a new technical-diffusion-based framework to generalized analyses Neo-classic Growth Convergence Mechanism and the New Growth Convergence Mechanism based on the Dowrick and Rogers' framework. The results indicate that since reform and opening up, especially during the period from 1981 to 2005, there are effects both of Neo-classic Growth Convergence Mechanism and New Growth Convergence Mechanism mechanism. However, at different times, the convergence of different mechanisms plays a role. Before 1990, capital accumulation has significant effect, the Neo-classical Mechanism of convergence exists, but after 1990, the effect of the Neo-classical Mechanism is not obvious. From 1986 to 1995 and from 2001 to 2005, the technical diffusion has significant effect. However, in other periods, New Growth Mechanism of convergence does not exist.