The Differential Factors of Regional Development in China: A DPG Approach
Generally speaking, the economically active space is not a simple geometrical one, but is restricted in many ways. Among other restrictions, we can cite natural geography, human geography, historical and cultural conditions, institutions, and central and local government policies. The combinations of these factors determine disparities of economic activities between regions. This leads to different industrial structures being developed in different regions of the same country. We then need to consider what factors are important in explaining these regional differences in development and understanding what the differences indicate. In this chapter, using a deviation from proportional growth (DPG) model which is derived from structural decomposition techniques of Input-Output (IO) analysis,1 we compare the differences in industrial structure of the eight regions in China. The data of the interregional China IO table of 2000 are compared, and based on these comparisons, we analyse its factors in each industrial sector from the point of view of the demand.
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