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ID: 134860

Health shocks, village elections, and household income: Evidence from rural China / Zhang, Jing; Gan, Li ; Xu, Lixin Colin ; Yao, Yang

Yao, Yang	Article
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Summary/Abstract

Using a sample of 1185 households in 48 Chinese villages for the period 1987–2002, we study the effects of major health shocks on household income and the role played by village elections in mitigating these effects. Major health shocks are defined by abnormal increases in a household's medical expenditure. Our results show that a major health shock reduces households' net income significantly and that village elections alleviate such adverse impacts by almost half. The main mechanism behind this effect is increased coverage of health care insurance, which helps households smooth their consumption when major health shocks happen.

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ID: 100753

Heterogeneous production functions and regional disparity / Jia, Nan; Gan, Li

Jia, Nan	Journal Article
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2010.

Summary/Abstract

On explaining regional differences, the current literature emphasizes the difference in factor accumulations. This paper suggests an additional possibility that regions may differ in parameter values in their production functions. In terms of the Cobb-Douglas production function, regions may differ in the share of capital in income. Using the province-level data in China, this paper shows that capital shares have a very significant and positive effect on per capita GDP. In particular, the differences in production functions explain 46.6% of the difference in per capita output between the East region and West region in China. Further, using the firm-level data, we show that the differences in regional production function are likely due to different industry compositions.

Key Words

Regional Disparity ; Factor Share ; Production Function

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