A spatiotemporal analysis of county economy and the multi-mechanism process of regional inequality in rural China

Abstract

Abstract The aim of this paper is to analyze the spatiotemporal pattern of county economy and investigate the multi-mechanism process of regional inequality in rural China. Empirical analysis is based on 2076 counties (921 urban districts are excluded), 338 prefecture-level cities, 31 provincial units and four regions of China from 2000 to 2015. Data has identified 73.13% of Gross Domestic Product being created in counties of China and the difference between urban districts and counties started to decrease over time in four regions. The spatial pattern of county economy is highly imbalanced and spatial agglomeration of county economy is self-reinforcing from 2000 to 2015. Based on the theoretical framework proposed in this paper and drawing upon spatial panel regression models, the multi-mechanism process of regional inequality in rural China demonstrates strong regional variations and temporal effect. Urbanization and fiscal transfers are negative associated with county economy in central and northeastern regions; the constraining effect of physical factors is decreasing over time and the positive impact of bank loans is statistically significant in all regions. The “province administering counties” institution only achieves some success in stimulating county economy in coastal provinces and its impact is negative in less-developed central and western regions. This research facilitates political strategies-making of regional development and rural revitalization.