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Spatial Externalities and Regional Income Inequality: Evidence from China’s Prefecture- Level Data

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Based on panel data of 282 prefectures in China from 1999 to 2004; we explore the relationship between market potential, employment density and per capita GDP by using a dynamic panel data approach. It is found that the externalities arising from market potential and employment density have a positive and significant effect on local income. Moreover, both absolute and standardized elasticity of market potential externalities are pronounced, which suggests that market potential has a greater impact on regional disparity.

10.1007/s11459-010-0016-1
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/content/journals/10.1007/s11459-010-0016-1
2010-01-01
2016-12-03

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