YAO Peng, SUN Jiuwen:Trade Openness and the Spatial Effect of Regional Income:Evidence From China

Abstract：Can trade openness shape the internal economic geography of a country? Empirical evidence on the spatial effects of trade openness in developing countries is limited.We try to test the effect of trade openness on regional income, using the data set of 324 Chinese prefecture level regions in 2010.We introduce the SDM model and control variables, such as human capital, the per capita capital investment, government support, to analyze this relationship.Our findings show that trade openness and human capital have positive effect on the income level of both the region and adjacent regions.Otherwise, the per capita capital investment and government support have a positive effect on the income level of the region, but have a negative effect on adjacent regions.

Key words： China    Trade Openness    Spatial Dependence    Spatial Durbin Model

source:Finance & Trade Economics ,No.1,2015