Trade Integration, Market Size, and Industrialization: Evidence from China [推广有奖]

1 论文标题
Trade Integration, Market Size, and Industrialization: Evidence from China's National Trunk Highway System
2 作者信息
Benjamin Faber
3 出处和链接（比如，NBER working paper No.11000）
http://emlab.berkeley.edu/~faberb/China2013.pdf
4 摘要
Large scale transport infrastructure investments connect both large metropolitan cen-
ters of production as well as small peripheral regions. Are the resulting trade cost
reductions a force for the diusion of industrial and total economic activity to periph-
eral regions, or do they reinforce the concentration of production in space? This paper
exploits China's National Trunk Highway System as a large scale natural experiment
to contribute to our understanding of this question. The network was designed to
connect provincial capitals and cities with an urban population above 500,000. As
a side eect, a large number of small peripheral counties were connected to large
metropolitan city regions. To address non-random route placements on the way be-
tween targeted city nodes, I propose an instrumental variable strategy based on the
construction of least cost path spanning tree networks. The estimation results sug-
gest that network connections led to a reduction in GDP growth among non-targeted
peripheral counties due to reduced industrial output growth. Additional estimation
results present evidence that appears consistent with the existence of core-periphery
eects of trade integration as found in increasing returns trade theory and economic
geography.



online appendix: http://emlab.berkeley.edu/~faberb/China2013OnlineAppendix.pdfhttp://emlab.berkeley.edu/~faberb/China2013.pdf