The Evolution and Differentiation of Economic Convergence of Resource-based Cities in Northeast China

Abstract

A key target of the overall strategy implementation for regional development since the 18th Party Congress of China has involved taking measures to narrow regional disparities. This is because resource-based cities’ economic development has fallen below general levels due to resource exhaustion and an unbalanced industrial structure, among other factors. Further, an economic gap has long existed between Northeast China’s large number of resource-based cities and non-resource-based cities. This article comprehensively studies the economic convergence of Northeast China’s resource-based cities and non-resource-based cities from 1996 to 2015 by using a dynamic panel to analyze not only the economic development of different industries and types of cities, but also the main factors that influence economic development. The empirical results demonstrate that economic convergence exists in both resource-based and non-resource-based cities, but the economic gap between them has clearly narrowed since the implementation of a strategy to revitalize the Northeast’s old industrial base. Shrinking cities are the fastest to converge, as mature cities are slower and regenerating cities are the slowest; regarding industry structure, the secondary industry dominates the economy in mature and shrinking cities, and the tertiary industry in regenerating cities. The primary stimulus in resource-based cities’ economic development involves upgrading the industrial structure and investing in human capital. As China faces a ‘new normal’ economy, resource-based cities in Northeast China should restructure the economy and perfect their market system to avoid again widening the economic gap.