EXPLAINING INDUSTRIAL-GROWTH IN COASTAL CHINA - ECONOMIC-REFORMS ... AND WHAT ELSE

In the 1980s China experienced ''an explosion of pent-up entrepreneurs hip'' facilitated by wide-ranging, although often unorthodox, economic reforms. This article uses data on the output of 23 industrial sector s in seven coastal regions (Provinces and counties) over the period 19 85 to 1989 to study the correlates of growth. Although industry-specif ic features-the degree of specialization and competition-had some infl uence on growth, much of the action came from region-specific influenc es and regional spillovers. Regional influences included the open-door policies and special economic zones that successfully attracted inves tments from overseas Chinese to particular locations. Existing regiona l strengths, especially high-qualify human capital and infrastructure, also contributed to growth. The results illuminate the interplay betw een conditions conducive for growth-for example, the contribution of f oreign expertise is greatly enhanced by available human capital. China made judicious use of the advantages of backwardness by targeting are as that were less developed and less encumbered by the legacy of exist ing institutions, although it was fortunate in this regard that the ba ckward regions were in close proximity to Hong Kong and Taiwan (China) . Important also was the transmission of growth impulses across the pr ovinces and counties, possibly through prereform cadre and administrat ive networks.