Foreign direct investment and regional inequality in China

One downside effect of rapid economic growth in China has been the ever rising inter-regional inequality. Foreign direct investment (FDI) has been blamed for driving the Chinese regions apart. It is difficult to reconcile the positive effect of FDI on economic growth with its potential ‘negative’ effect on regional inequality. Using the largest panel dataset for the Chinese regions over 1979-2003 and employing an augmented Cobb-Douglas production function, this paper proves that FDI has been an important factor of economic growth in China. It also suggests that it is the uneven distribution of FDI instead of FDI itself that has caused regional growth differences.Foreign direct investment, regional inequality, China

Foreign Direct Investment and Regional Inequality in China

China?s economic miracle over the past three decades has been featured with its open-door policy, especially the absorption of foreign capital. One downside effect of economic reform has been the ever rising interregional inequality. As FDI is highly unevenly distributed across regions, many scholars and policymakers have blamed their inflows as one of the main factors driving the Chinese regions apart. If this logic were true, then controlling the scale of FDI could be a solution to reduce regional inequality. However, it is difficult to reconcile the positive effect of FDI on economic growth with its potential ?negative? effect on regional inequality. This is a controversial and provocative issue in the economic development literature. Using the largest panel dataset covering all the Chinese regions over the entire period 1979-2003 and employing an augmented Cobb-Douglas production function, this paper proves that FDI has been an important factor responsible for regional growth differences in China. However, it suggests that FDI cannot be blamed for causing regional inequality; it is the uneven distribution of FDI instead of FDI itself that has caused regional growth differences. The key policy issue is that FDI should be guided towards the inland areas with preferential policies in order to improve the spatial allocation of investments as a means to reduce regional inequality.foreign direct investment, regional inequality, China

Over-Expression of a Maize N-Acetylglutamate Kinase Gene (ZmNAGK) Improves Drought Tolerance in Tobacco

Water deficit is a key limiting factor that affects the growth, development and productivity of crops. It is vital to understand the mechanisms by which plants respond to drought stress. Here an N-acetylglutamate kinase gene, ZmNAGK, was cloned from maize (Zea mays). ZmNAGK was expressed at high levels in maize leaves and at lower levels in root, stem, female flower and male flower. The expression of ZmNAGK was significantly induced by PEG, NaCl, ABA, brassinosteroid and H2O2. The ectopic expression of ZmNAGK in tobacco resulted in higher tolerance to drought compared to plants transformed with empty vector. Further physiological analysis revealed that overexpression of ZmNAGK could enhance the activities of antioxidant defense enzymes, and decrease malondialdehyde content and leakage of electrolyte in tobacco under drought stress. Moreover, the ZmNAGK transgenic tobacco accumulated more arginine and nitric oxide (NO) than control plants under drought stress. In addition, the ZmNAGK transgenic tobaccos activated drought responses faster than vector-transformed plants. These results indicate that ZmNAGK can play a vital role in enhancing drought tolerance by likely affecting the arginine and NO accumulation, and ZmNAGK could be involved in different strategies in response to drought stress

Sources of Structural Change and Output Growth of China's Economy: 1987-92

This paper examines the sources of structural changes in output growth of China’s economy over 1987–92 using a decomposition method within the input-output (IO) framework. The model uses three comparable IO tables of 1987, 1990, and 1992 as the main data sources; it accounts for output changes from a demand side perspective and decomposes the growth of output into consumption demand, investment demand, export, import, and intermediate use (indicated by changes in IO coefficients). Special attention is given to identifying the effects of government policies on economic growth and structural change. It is found that overall output growth was multi-components driven rather than single-factor led; the share of the contribution to output growth from consumption and investment expansion declined and that from export and import increased. Whilst the efficiency of factor utilisation remains an issue of further research, a remarkable rise in IO coefficient share indicates a deepening and strong interdependence between industrial sectors over the data period. Copyright Kluwer Academic Publishers 1998output growth; structural change; input-output analysis; decomposition; China,

Structural Change in Apartheid-era South Africa: 1975-93

This paper examines the sources of structural changes in output growth of South Africa's economy over 1975-93 using a decomposition method within the inputoutput (IO) framework for analysing output changes from a demand side perspective. It decomposes output growth into private consumption, government consumption, investment and export components and also measures the impact of import substitution and changes in intermediate input use (as indicated by changes in IO coefficients). It is found that, before 1981, overall output growth was multi-components driven with all the above components contributing positively to economic growth. However, the collapse of investment demand is by far the single largest factor contributing to the economic stagnation that categorizes the post-1981 period.Output Growth, Structural Change, Decomposition, South Africa,