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The economic consequences of political hierarchy: evidence from regime changes in China, 1000–2000 C.E.

Bai, Ying and Jia, Ruixue (2023) The economic consequences of political hierarchy: evidence from regime changes in China, 1000–2000 C.E. Review of Economics and Statistics, 105 (3). pp. 626-645. ISSN 0034-6535

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Identification Number: 10.1162/rest_a_01058


We study how political hierarchy shapes regional development in China, using variations driven by regime changes during the 1000–2000 C.E. period. We find that changes in the status of the provincial capital led to the rise and decline of different prefectures as measured by population and urbanization. Two other novel findings stand out: (1) the economic advantages of the provincial capitals did not persist if they lost their political status, and (2) political hierarchy shaped economic development not only through public employment but also through the development of important infrastructure, such as transportation networks. Our findings highlight the importance of politics in determining the locations of economic activities.

Item Type: Article
Additional Information: Funding Information: An earlier version of this paper was circulated under the title “The Oriental City?: Political Hierarchy and Regional Development in China, A.D. 1000– 2000.” We thank Rema Hanna, the anonymous referees, Treb Allen, Konrad Burchardi, Filipe Campante, Donald Davis, Edward Glaeser, Walker Han-lon, Stephan Haggard, Gordon Hanson, Jeffrey Lin, Stelios Michalopou-los, Nancy Qian, Craig McIntosh, Torsten Persson, James Rauch, Andrei Shleifer, Xiaoxue Zhao, Junfu Zhang, Fabarizio Zilibotti, and the participants in various seminars for their comments. Y.B. acknowledges the financial support of the Research Grants Council of Hong Kong (grant n. GRF 14502118). Publisher Copyright: © 2021 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.
Divisions: Management
Subjects: H Social Sciences
H Social Sciences > HB Economic Theory
Date Deposited: 08 Jun 2023 09:48
Last Modified: 22 Apr 2024 19:00

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