Resource Abundance and Resource Dependence in China

CentER Discussion Paper Series No. 2010-109

43 Pages Posted: 14 Oct 2010

See all articles by J.R. Magnus

J.R. Magnus

Vrije Universiteit Amsterdam, School of Business and Economics

Kan Ji

affiliation not provided to SSRN

Wendun Wang

Erasmus University Rotterdam (EUR) - Department of Econometrics

Date Written: October 12, 2010

Abstract

This paper reconsiders the ‘curse of resources’ hypothesis for the case of China, and distinguishes between resource abundance, resource rents, and resource dependence. Resource abundance and resource rents are shown to be approximately equivalent, and their association with resource dependence varies with institutional quality. Resource abundance/rents has a positive impact on economic growth, while resource dependence has a negative impact. The impact of the ‘West China Development Drive’ policy, started in 2000, is substantial, and this is investigated through a comparative analysis based on cross-section samples, and through a panel-data time-varying coefficient approach for West and East provinces. Resource effects do change after the policy shock.

Keywords: Natural resource curse, Economic growth, China, Institutional quality, Resource abundance, Resource dependence, Regional differences, Policy change

JEL Classification: O11, O13, O53, C21, Q0, Q33

Suggested Citation

Magnus, Jan R. and Ji, Kan and Wang, Wendun, Resource Abundance and Resource Dependence in China (October 12, 2010). CentER Discussion Paper Series No. 2010-109. Available at SSRN: https://ssrn.com/abstract=1691569 or http://dx.doi.org/10.2139/ssrn.1691569

Jan R. Magnus (Contact Author)

Vrije Universiteit Amsterdam, School of Business and Economics ( email )

De Boelelaan 1105
Amsterdam, 1081HV
Netherlands

Kan Ji

affiliation not provided to SSRN ( email )

Wendun Wang

Erasmus University Rotterdam (EUR) - Department of Econometrics ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands

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