The Research On Regional Economic Disparities And Economic Convergence Of Guangdong Province

Since China’s reform and opening up, Guangdong becomes the fastest growing provinces in the country and the most unbalanced developing region. The huge distance of regional economy in Guangdong province distorts the resources allocation, and becomes a potential risk of sustained and rapid development of Guangdong’s economic in the future. The third Plenum of the16th Central Committee of the CPC has set the goal of narrowing the distance and unifying the regional development. Guangdong should seize the current favorable conditions and make full use of its advantages to get out of the dilemma. This paper takes Guangdong as the research object, reveals the cause of regional economic disparities, mines factors affected economic convergence and its mechanism of action, and tries to put forward reference policy recommendations.This paper mainly uses the combination of theory and empirical research method. First, after setting the research questions, this paper further studies the neoclassical growth theory and the new growth theory, illustrates the economic convergence ideas in the two theories and then combs the related classic literatures; Second, it introduces the derivation, expansion and establishment of the convergence model as well as the use of the panel data model in the form of setting; Finally,this paper tests the Guangdong regional economic respectively from o convergence、absolute β convergence、club convergence or condition β convergence, and then uses Dowrick-Rogers model to analyze convergence mechanism.There are three main conclusions in this paper:(1) the absolute difference between different regions of Guangdong has always been rising, the absolute difference in the Pearl River Delta region is almost consistent with the overall difference in Guangdong. And the relative difference of overall level of economic development in Guangdong sample range is on the decline. In the aspect of four major economic regions, not only have the expansion of regional disparities, but also expansion of inter-regional disparities;(2) regional economic growth in Guangdong is absolute β convergence, but the economic growth is not negatively decided by the initial level of output simply.In reality, some developed regions are growing with a higher growth rate than other developing regions. This indicates that the developing regions does not naturally get the "Advantage of Backwardness" to catch up the developed regions. The phenomenon of "club convergence" in four major economic regions is obvious, and there is an significant growth to the same in each region;(3) Guangdong’s economic growth difference between the intercity shows significant conditional convergence, the degree of openness, the level of industrialization and the level of market play significant positive roles in promoting the cities’growth. Therefore, differences in these variables between the cities is the main cause of differences in economic development;(4) There are two mechanisms for convergence among different regions in Guangdong:the mechanism of Neo-classical convergence and the mechanism of Now economic convergence.Finally, on the basis of theoretical analysis and empirical test, policy Suggestions are given respectively from the policy level, institutional level and industry level.