Persistence of cities: Evidence from China

• Date: 01 May 2019
• Published date: 01 May 2019
• DOI: http://doi.org/10.1111/rode.12565
• Author: Bulent Unel,Fan Duan

REGULAR ARTICLE

Persistence of cities: Evidence from China

Fan Duan

|

Bulent Unel

Department of Economics, Louisiana

State University, Baton Rouge, LA

Correspondence

Bulent Unel, Department of Economics,

Louisiana State University, Baton Rouge,

LA 70803.

Email: bunel@lsu.edu

Abstract

Using data from the Qing dynasty, we investigate the

long-run impact of early development on today's living

standards in China. We use city-level population density

in 1776 as a measure of early economic prosperity, and

examine how it is associated with today's development

indicators such as the average night light density, GDP

per capita, average years of schooling, and trade open-

ness. We find that cities which were more prosperous

during the Qing dynasty are now also brighter, richer,

more educated, and more open.

KEYWORDS

China, Qing dynasty, light density, population density, openness,

schooling

1

|

INTRODUCTION

China now has the second largest economy in the world, but living standards vary significantly

across its regions (Unel & Zebregs, 2009). In 2010, for example, the income per capita in

Shanghai was more than five times that of Gansu. Previous studies have mainly focused on

identifying factors that may have driven unequal performance across regions after the reforms

which began in 1978. These factors include reallocation of resources from agriculture to manu-

facturing and services (Brandt, Hsieh, & Zhu, 2008), enterprise restructuring and privatization

(Dong, Putterman, & Unel, 2006; Fisher-Vanden & Jefferson, 2008; Hsieh & Klenow, 2009),

financial reorganization (Yi, 2010), and globalization (Unel & Zebregs, 2009; Sun & Heshmatib,

2010).

These studies, however, have paid limited attention to the fact that living standards differed sig-

nificantly across regions even before the reforms. In 1978, for example, the incom e per capita in

Shanghai was about 3.5 times that of Gansu, suggesting a persistence of cross-regional differences

in living standards. This paper argues that the wide economic differences across regions in China

can be traced to their early developmental levels. More precisely, we use the city-level population

DOI: 10.1111/rode.12565

Rev Dev Econ. 2019;23:663–676. wileyonlinelibrary.com/journal/rode © 2018 John Wiley & Sons Ltd

|

663