An Analysis Of Yunnan Regional Economic Disparity And Convergence

Since the reform and opening up, China’s economy has boomed, accompanied by the rapid changes in the regional economic disparities.During this period, Yunnan also has experienced sustained and rapid economic development. On the other hand, Yunnan is located in the frontier of southwest China with complex terrain and inconvenient transportation. It lacks economic exchanges with the outside world, resulting in its characteristics of regional economic disparities are different from China and other provinces. Excessive regional economic disparities will not only affect the development of the Yunnan’s economy, but also affect social stability. So it is necessary to conduct a detailed study on this aspect.Regional economy in Yunnan province has the following salient features:(1) Yunnan’s economic development is currently at a relatively low level(2) Kunming’s economy has performed much better than other cities in Yunnan, and(3) Central Yunnan’s economic development level is significantly higher than that of the other two areas of Yunnan.Aim to regional economic disparities of Yunnan, the paper raises three questions:(1) How wide are the regional economic disparities of Yunnan?(2) During the past period, have Yunnan’s regional economic disparities widened?and whether there is σ-convergence, β-convergence or club convergence in Yunnan?(3) Along with the development of economy, whether Yunnan’s regional economic disparities experience expansion and then narrowing,in accordance with the inverted-U hypothesis?The paper will use tools for measuring regional economic disparities and convergence to study the above three problems.Through the analysis of the statistical data, the author finds the current situation of regional economic disparities in Yunnan. The analysis shows that the regional economic disparities of Yunnan are wide at present. Kunming’s economy has performed much better than other cities.The paper calculates σ-convergence index, the analysis shows that the regional economic disparities have widened at first and then narrowed in the past 30 years. The disparities have narrowed for nearly 20 years. The analysis on Theil index shows that the changes of disparities are mainly dominated by the disparities between the three regions of Yunnan. The analysis of club convergence shows that, it has club convergence in economic development of Central Yunnan. The analysis of β-convergence shows that Yunnan has a β-convergence characteristic from 1987 to 2013, in spite of the convergence speed is low. On the other hand, it has two different convergence characteristics before and after the 1996. Before 1996, there was no β-convergence, but after 1996, it has a β-convergence characteristic in Yunnan.The paper also examines whether Yunnan’s regional economic development was in accordance with the inverted-U hypothesis. The analysis shows that Yunnan’s regional economic development was in accordance with the hypothesis during the study period.