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Financial Reform, Financial Development and Total Factor Productivity: Evidence from India’s Manufac

Time:2014-07-03 Clicks:

Subject:Factor Mobility and Output Convergence:An Empirical Evidence fromChina

Lecturer:Professor Xiaojun Wang(Special-Term Professor at CEFMS,Associate Professor with tenure, Department of Economics,UniversityofHawaiiat Manoa)

PresiderProfessor Wei Huang(Special-Term Professor at CEFMS,John and Sue Dean Distinguished Professor of Finance Shidler Collegeof Business,UniversityofHawaiiat Manoa)

Time:December 17th (Tuesday) : 10:00-11:30AM

Location:6th Floor Conference Room 601 in Administration Building (North Campus)


        Using the nonparametric club convergence tests developed in Phillips and Sul (2007), we find no evidence of full-sample convergence in real GDP per capita among 31 Chinese provinces in the post-reform period of 1978-2011. Instead, we find three distinctly ranked convergence clubs, each consists of several provinces that share some common characteristics. Sifting through a large number of potential explanatory variables, we identify a few that consistently appear to be closely associated with club membership. State share in gross industrial output has a significantly negative effect, indicating provinces in higher-ranked clubs tend to have a more vibrant non-state industrial sector. A larger working-age population share also contributes positively to club membership. Migration within and across provinces exhibit positive impacts, presumably reflecting improved human capital allocation. Lastly, consistent with the neoclassical growth theory, higher population growth hampers economic development.