由1970年晚期所進行開放改革政策後，中國經濟情況快速發展。許多文獻探討這樣快速發展的背後，可能造成區域間與區域內所得不均的現象。本文主旨是使用Im et al. (2005)所建立的panel LM unit root test允許由內生決定結構改變，重新探討開放改革前後全中國所得收歛存在與否。並且使用過去沒有考慮內生結構改變的傳統研究方法做一個比較基礎。當考慮到內生結構改變與沒有考慮到內生結構改變之結果是為不同，此驗證Perron (1989)的建議，若沒有考慮到結構改變可能會造成原本穩定的序列視為不穩定。

    估計結果除了認為中國各省與省之間是所得收歛外，並且指出內生結構改變應該發生的時間點。再者，此篇更是利用另一panel KPSS unit root test的虛無假設為stationarity，此與panel LM unit root test的虛無假設相反。以該假設來驗證實證結果，提供一個更有解釋力與可信賴的結果。其估計結果與最主要模型之結果為一致，顯示中國存在所得收歛。但此一結果與我們一般認知中國所得發散的想法背道而馳。然而這可能指出中國執行的西部開發政策減緩省與省之間所得差異問題。

Since China has rapid growth by the open-door economic reforms of the late 1970s, a number of studies have argued that this outstanding economic growth might cause the unbalanced development with and within regions. In this study, we re-investigate whether provincial-level incomes in China continue to diverge or converge by the newly developed panel LM unit root test, which allows for considering structural breaks endogenously. In order to make a comparison, we also implement conventional methodology without consideration of breaks. The results show that it provides different outcomes when we consider structural breaks endogenously corresponding to, as Perron (1989) suggested, the misleading results if there is no consideration of structural breaks.
  More importantly, the results suggest that the income convergence should exist among Chinese provinces and that the occurrence of break timing. Furthermore, we apply panel KPSS unit root test, which has an opposite null hypothesis to panel LM unit root test, to examine the main results for providing more powerful and robust test statistics, and the outcomes indicate the consistent results. The result of existence of convergence in China is quite different from the public views. However, this might indicates that the policy of West Development eliminates the difference among provinces.

TABLE OF CONTENTS
Chapter 1.	Introduction	1
	1.1 Brief Review of the Development of Chinese Economy	2
	1.2 Research Objectives	7
Chapter 2.	Literature Review	8
	2.1 σ and β-convergence	8
	2.2 Stochastic Convergence	10
	2.3 Mix of β and stochastic convergence	11
	2.4 Summary	12
Chapter 3.	Methodology	13
	3.1 Panel data series with structural breaks	15
	3.2 Panel LM unit root test	17
	3.3 Panel KPSS unit root test	18
Chapter 4.	Data Description and Preliminary Analysis	21
	4.1 Data	21
	4.2 Preliminary Analysis	23
Chapter 5.	Empirical Results	26
	5.1 Conventional Panel Unit Root Tests	26
	5.2 Panel LM unit root test with structural breaks	29
	5.3 Robustness Checks	33
	5.4 Summary	35
Chapter 6.	Conclusions	39
	Reference	42
	Appendix	45

LIST OF TABLES	
Table 1.	Provincial Growth Performance	6
Table 2.	Data Descriptive Statistics (real GDP per capita in logarithm)	22
Table 3.	Conventional Panel Unit Root Test	28
Table 4.	Panel LM Unit Root Test with Structural Breaks	32
Table 5.	Robustness Checks	37
Table 6.	Panel KPSS Unit Root Test with Structural Breaks	38
Table A1.	Conventional Panel Unit Root Test	45
Table A2.	Panel LM Unit Root Test with Structural Breaks	46
Table A3.	Robustness Checks	47
Table A4.	Panel KPSS Unit Root Test with Structural Breaks	48

LIST OF FIGURES		
Figure 1.	Average coastal vs. interior provincial incomes relative to the national mean
	24
Figure 2.	Roughly parallel growth paths of the poorest and wealthiest coastal provinces relative to average
	24
Figure 3.	Roughly parallel growth paths among the wealthiest and poorest interior provinces relative to average	25

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