ABSTRACT
There is no such thing as even economic development. Some people get richer, some regions prosper more than others. Why this should be so is a question that has puzzled people who work in the field of economics since the days of Adam Smith. On a world scale, uneven development is often attributed to nation-states and their governments, which are assumed to cause “uneven” development by interfering too much (the “Chicago” claim) 1 or by intervening too little (the Leftist claim). These arguments both fail when it comes to explaining regional-income differences within one country. After all, economies such as the United States, Australia, or Germany show remarkable regional income disparities regardless of the economic policies pursued. In the case of China, there is no reason for economists to assume that the benefits of economic reform would flow equally throughout the national territory. In every case, further explanations are required to explain regional income disparity within a particular national state. And further analytical concepts are called for to “catch” the geographical diversity of domestic economic outcomes.
