provided by Research Papers in Economics
5 June 1998
C:\Chinajie
The Paradox of Unequal Regional Investment and Equal
Regional Economic Growth in China
Foreign Direct Investment and Unequal Regional Economic Growth in China
Jie Zhang
Research Center of Bornholm
Stenbrudsvej 55, 3730 Nex0,
Denmark
Tel: (45) 5644 1144;
Fax: (45) 5649 4624
Email: jie@rcb.dk
Gustav Kristensen
Institute of Economics
Odense University
DK-5230, Odense M, Denmark
Tel: (45) 6557 2114
Fax: (45) 6595 7766
Emails guk@busieco.ou.dk
Abstract:
China’s policy on Special Economic Zones has attracted direct foreign investment to
China. The investment is very unequally distributed on China’s 30 regions.
The article focuses on the regional economic growth as a result of the direct foreign
investment in the region and its spill-over effects on neighboring regions. The unequal
distribution of foreign direct investment should in principle tends to enlarge the
regional economic differences. The article, however, shows that this is not the result
of the investment.
The empirical findings highlight the impact of foreign direct investment on the
Chinese regional economies in transition.
Paper prepared for the 38th Congress of the European Regional Science Association
Vienna, 28 August - 1 September.
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