Esiyok, Bulent and Ugur, Mehmet ORCID: https://orcid.org/0000-0003-3891-3641 (2017) Spatial dependence in the growth process and implications for convergence rate: evidence on Vietnamese provinces. Journal of the Asia Pacific Economy, 23 (1). pp. 51-65. ISSN 1354-7860 (Print), 1469-9648 (Online) (doi:10.1080/13547860.2017.1351764)

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Abstract

Existing studies on Vietnamese provinces (e.g., Anwar and Nguyen, 2010) tend to assume that province-specific growth is independent of that in its neighbours. However, many studies analysing regional economic growth in China, Brazil and Mexico report the existence of spatial spill-over effects. This paper investigates whether this is the case for 60 Vietnamese provinces for the time-period 1999-2010, using a system-GMM estimator and a Solow growth model augmented with human and physical capital and spatial lag covariates. We report that spatial dependence is a significant determinant of growth and conditional convergence in Vietnamese provinces. We also demonstrate that the rate of convergence decreases as the distance between neighbouring provinces increases. Given these findings, we recommend testing for spatial dependence in growth models for Vietnam and beyond to avoid omitted variable bias and inform evidence-based regional policies that take account of spatial externalities.

Item Type:	Article
Uncontrolled Keywords:	economic growth, spatial dependence, regional convergence, GMM
Subjects:	H Social Sciences > HB Economic Theory
Faculty / School / Research Centre / Research Group:	Faculty of Business Faculty of Business > Department of International Business & Economics Faculty of Business > Institute of Political Economy, Governance, Finance and Accountability (IPEGFA) > Greenwich Political Economy Research Centre (GPERC) Faculty of Business > Institute of Political Economy, Governance, Finance and Accountability (IPEGFA)
Related URLs:	Publisher
Last Modified:	04 Aug 2021 16:33
URI:	http://gala.gre.ac.uk/id/eprint/17507

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