DO PLACE-BASED POLICIES IN CHINA STIMULATE LOCAL CONSUMPTION VIBRANCY?

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This study examines the impact of China’s Special Economic Zones (SEZs) on local consumption vibrancy, which is measured with new openings of the KFC and McDonald’s outlets every year within each spatial analysis unit, defined as a [Formula: see text] grid. We employ a difference-in-differences setting to examine the impact of SEZ establishment on newly built fast-food restaurants. With alternative specifications and subsamples, we attempt to confirm that the increase in new openings after SEZ establishment is not driven by unobservable characteristics or moving catering activities from faraway to SEZ areas. We also estimate the spillover effects of the positive impact of SEZs on neighboring regions.