Chinese Official Exchange and Economic Growth

Abstract

Since the establishment of the official exchange system in 1990, official exchanges in China have been ongoing, generally including two forms of communication: horizontal and vertical. A large amount of literature has proven that horizontal communication can promote local economic growth in different forms and to varying degrees. However, there is limited literature research based on vertical communication. Based on the Panel data of the central and local officials' vertical exchange of officials in 2010, this paper uses the double difference method to demonstrate whether the vertical exchange of officials can promote local economic development. The results indicate that vertical communication promotes economic growth in the destination and brings a positive impact of 2.56%. This indicates that officials with central to local vertical exchanges may also have incentives to promote local economic development. The findings of this article help to fill the gap in the research field of vertical communication and local economic growth.