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Abstract

In this study, we use a multilateral total factor productivity (TFP) panel data, spanning 1985-2013 period, to test hypotheses of convergence to a single TFP level (σ convergence) and to a region-specific steady state TFP growth rate (β convergence) for China’s farm sector. Results show that there is no evidence of an overall σ convergence across all provinces. However, we find robust evidences of β convergence. Estimated rates of β convergence are conditional on how we capture the heterogeneity across regions. Overall, the rate of β convergence ranges from 0.016 to 0.039. Estimates also show that higher growth rate of education, R&D, capital/labor ratio, or intermediate goods/labor ratio can boost the rate of TFP growth.

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