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Institutions and Chinas comparative development

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Document pages: 59 pages

Abstract: Robust assessment of the institutionalist account of comparative developmentis hampered by problems of omitted variable bias and reverse causation, sinceinstitutional quality is not randomly assigned with respect to geographic andhuman capital endowments. A recent series of papers has applied spatialregression discontinuity designs to estimate the impact of institutions onincomes at international borders, drawing inference from the abruptdiscontinuity in governance at borders, whereas other determinants of incomevary smoothly across borders. I extend this literature by assessing theimportance of sub-national variation in institutional quality at provincialborders in China. Employing nighttime lights emissions as a proxy for income,across multiple specifications I find no evidence in favour of aninstitutionalist account of the comparative development of Chinese provinces.

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