An Empirical Research On The Issue Of Regional Economic Convergence Of China (1978～2004)

Since the reform and opening up to the outside world, the gradual enlargement of the disparity of regional economy has companied the highly economic growth of China. More and more people have paid their attention to the issue of regional economy. In these years, the convergence issue of the regional economy has become the heated topic of policy study and academic research. Is there regional economy convergence in China? What factors do influence regional economy convergence? Can convergence of the regional economy be improved through the improvement of those factors? These are the issues involved in this thesis. The empirical material indicates that the highly growth of economy in China mainly depends on the increase of entity's factor input, which is limited by resource bottleneck more and more at present, and it is very urgent to change the style of economic growth. Endogenous Growth Theory considers that economic long-term growth continuously derives from economic endogenous factors, such as technological progress, accumulated knowledge, improvement of the human capital level, etc. So this thesis studies Chinese regional economy convergence issue from the perspective of Endogenous Growth Theory.During the market-oriented reform in China, every province, municipality directly under the Central Government and autonomous region has obtained more independent power than that in the highly-planned economy period. They can implement policies and goals independently to develop regional economy on the basis of their own resource natural endowment, geographical position, human environment, human capital level, etc. This will lead to different economic growing paths among the regions. The economic growing routes are very similar in some nearby places which have most natural resources in common. So it matters to choose suitable regional dividing approaches to study Chinese regional economy issue. Because of its inherent defect, I have abandoned traditional "three belts of China" and selected reasonable "eight major regions" dividing approaches to study the convergence of the regional economy.The thesis consists of five chapters. Chapter one is the introduction. Based on the reality and theoretical researches, chapter one points out the disparity widening progressively and serious consequence of regional economy of our country, and the certainty of studying China's regional issue from the point of Endogenous Growth Theory. Then a literature review is made. Finally, relevant concepts are defined. In chapter two, basic and economic situations of "eight major regions "have been described based on the latest data over the years. In chapter three, endogenous growth model has been set up and the equation on the regional economy convergence has been obtained depending on the dynamism of the model. By testing the economic data of 29 provinces of China, this thesis draws the conclusion that "club convergence" and "conditional convergence" do exist in the "eight major regions" in our country and this thesis has also found out 4 important factors influencing China's regional economy convergence. Chapter four analyses the factors which affect our regional economy convergence and its function.This thesis applies panel data of 29 provinces of China from 1978 to 2004 to overall analysis to the economic convergence of our country. The innovation of this thesis can be presented as the following:Firstly, new perspective: The traditional studies of regional economic convergence generally begin with neoclassical Solow's Model and analyze regional economy convergence from the perspective of "three belts of China". This thesis faces the defects of dividing of" three belts of China ", from the perspective of" eight major regions "for the first time, study the convergence of regional economy of our country based on the Endogenous growth Theory.Secondly, new model. The author has established the endogenous model on the regional economic convergence and obtained the main factor influencing the regional economic convergence. Moreover, I concluded that the growth rate of balanced output of one country (region) depends on the saving level of material capital, the saving level of human capital, regional factor, system efficiency, population growth rate and depreciation rate of this country (region).Thirdly, apply latest data to analyze the regional economic convergence of our country. The analysis results indicate that the level of opening to the outside world and marketization degree obviously facilitate the economic convergence, industrialization degree and saving rate are the impetus of the economic convergence, too.Finally, new conclusion. The research results show that human capital has positive relationship with regional economic convergence of China, but the result is not prominent. This is contrary to a lot of research conclusions of our country. On one hand, this reflects the limitation of the variable the author chooses. On the other hand, it reflects the driving force of China's present human capital level to economic growth and convergence isn't prominent.