Regional Correlation and Spatial Spillovers in China’s Regional Economic Growth

Using an exploratory spatial data analytical tool, this paper examines the spatial distribution patterns and features of GDP per capita in each of China’s provinces. The results indicate that a positive global spatial autocorrelation exists and increases over time. At the same time, local correlation shows that China’s local spatial agglomeration is becoming ever more marked. Based on a new economic geography model signaling the effects of market potential on regional economic development, this paper further investigates spatial spillover effects on Chinese regional economic growth through econometric analysis. Our empirical analysis shows that spatial spillovers play an important role in China’s regional economic development. Every 1 percent increase in market potential leads to an increase of 0.47 percent in regional GDP per capita, outperforming increases in regional fixed assets investment in terms of elasticity. Of course, our analysis also shows that spatial spillover effects decrease as inter-regional distance increases.