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Cesifo Working Paper No. 8104 A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Holz, Carsten A. Working Paper The Process of Economic Development in West Sichuan: The Case of Daocheng County CESifo Working Paper, No. 8104 Provided in Cooperation with: Ifo Institute – Leibniz Institute for Economic Research at the University of Munich Suggested Citation: Holz, Carsten A. (2020) : The Process of Economic Development in West Sichuan: The Case of Daocheng County, CESifo Working Paper, No. 8104, Center for Economic Studies and ifo Institute (CESifo), Munich This Version is available at: http://hdl.handle.net/10419/215106 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle You are not to copy documents for public or commercial Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich purposes, to exhibit the documents publicly, to make them machen, vertreiben oder anderweitig nutzen. publicly available on the internet, or to distribute or otherwise use the documents in public. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, If the documents have been made available under an Open gelten abweichend von diesen Nutzungsbedingungen die in der dort Content Licence (especially Creative Commons Licences), you genannten Lizenz gewährten Nutzungsrechte. may exercise further usage rights as specified in the indicated licence. www.econstor.eu 8104 2020 February 2020 The Process of Economic Development in West Sichuan: The Case of Daocheng County Carsten A. Holz Impressum: CESifo Working Papers ISSN 2364-1428 (electronic version) Publisher and distributor: Munich Society for the Promotion of Economic Research - CESifo GmbH The international platform of Ludwigs-Maximilians University’s Center for Economic Studies and the ifo Institute Poschingerstr. 5, 81679 Munich, Germany Telephone +49 (0)89 2180-2740, Telefax +49 (0)89 2180-17845, email [email protected] Editor: Clemens Fuest www.cesifo-group.org/wp An electronic version of the paper may be downloaded · from the SSRN website: www.SSRN.com · from the RePEc website: www.RePEc.org · from the CESifo website: www.CESifo-group.org/wp CESifo Working Paper No. 8104 The Process of Economic Development in West Sichuan: The Case of Daocheng County Abstract Economic development of a remote, mountainous region is a challenge for any country. This paper examines how this development challenge has been addressed in a high-altitude backward region of the People’s Republic of China. Is this region increasingly being left behind or has it entered a sustainable development trajectory? What form does economic development take? What is the role of the government vs. the private sector? What are the broader socio-economic and cultural consequences? The focus is on Daocheng County, Ganzi Tibetan Autonomous Region, West Sichuan. The fact that it is a predominantly Tibetan county adds a nationality dimension to the issue of economic development. JEL-Codes: O120, O230, O250, O530, L830, Z320. Keywords: economic development, tourism development, infrastructure development, poverty alleviation, backward region, fiscal transfers, Tibet. Highlights: Examination of how economic development comes about in a backward region Potential role of tourism in economic development Importance of fiscal transfers for initiating economic development Role of the government vs. the private sector in economic development Socio-economic and cultural implications of development Carsten A. Holz Division of Social Science Hong Kong University of Science & Technology Clear Water Bay / Kowloon / Hong Kong [email protected] 31 January 2020 (Version of 10 October 2019 with minimal modifications) The work described in this paper was supported by a grant from the Research Grants Council of the Hong Kong Special Administrative Region, China (Project No. HKUST 640413). Contents A. Introduction ........................................................................................................................... 4 B. Daocheng County .................................................................................................................. 6 C. Fiscal Transfers ..................................................................................................................... 7 D. Tourism ................................................................................................................................. 8 1. Tourism numbers ................................................................................................................ 9 2. Marketing .......................................................................................................................... 11 3. Three approaches to tourism development ....................................................................... 12 a. Duikou model: Jinzhuzhen’s Yading Tianjie ............................................................... 12 b. Private investor model: Riwa’s Holyland Corporation ................................................ 14 c. Tibetan-Han collaboration ........................................................................................... 15 4. Evaluation ......................................................................................................................... 16 E. Development Outcomes ...................................................................................................... 18 1. Aggregate income ............................................................................................................. 1 8 2. Employment ...................................................................................................................... 19 3. Household income ............................................................................................................ 20 4. Socio-economic outcomes ................................................................................................ 21 F. Conclusions ......................................................................................................................... 24 2 Figures Figure 1. Daocheng – Yading Location Map ........................................................................... 31 Figure 2. Daocheng County Ratios of Budget Measures to GDP............................................ 32 Figure 3. Daocheng County Visitor Nights ............................................................................. 32 Figure 4. Daocheng County Monthly Distribution of Domestic Visitor Nights (2015, %) ..... 33 Figure 5. Daocheng County Hotel Prices and Availability 2016-2017 (Ctrip) ....................... 33 Figure 6. Daocheng County Sector Shares in GDP (%) .......................................................... 44 Figure 7. Daocheng County GDP and Sector Value-added Real Growth Rates (%) .............. 45 Figure 8. Daocheng County Private Share in Sector’s Value-added (and GDP) (%) .............. 46 Figure 9. Daocheng County Sector Shares in Private Aggregate Value-added (%) ................ 46 Figure 10. Daocheng County Ratios of Fiscal Expenditure to Revenues ................................ 52 Tables Table 1. Sector Shares in GDP and Private Sector Shares (%) ............................................... 34 Table 2. Daocheng County Fiscal Revenue and Expenditure Shares ...................................... 36 Table 3. Aggregate Expenditures Component Shares (%) ...................................................... 37 Table 4. Daocheng County Hotel Count .................................................................................. 38 Table 5. Daocheng County Room Count ................................................................................. 38 Table 6. Daocheng County Tourism Income and Value-added (VA) ..................................... 39 Table 7. Daocheng County Population (2015) ........................................................................ 40 Table 8. Daocheng County Formal Employment (2015) ......................................................... 40 Table 9. Daocheng County Household Income (2015) ........................................................... 41 Table 10. Daocheng County Government Funds Income and Expenditures ........................... 50 Table 11. Daocheng County Fiscal Revenue and Expenditure Shares (%), complete table ... 51 Table 12. Tourism-related Data, Economic Census 2013 ....................................................... 68 Table 13. Daocheng County Tourism Income and Value-added, complete table ................... 74 Table 14. Daocheng County Formal Employment (2015), complete table ............................. 78 Appendices Appendix 1. Field Research in Daocheng County ................................................................... 42 Appendix 2. GDP Growth and Private Economy over Time ................................................... 44 Appendix 3. Road Construction Costs ..................................................................................... 47 Appendix 4. Daocheng-Yading Airport ................................................................................... 48 Appendix 5. Daocheng County Detailed Fiscal Data (and Banking
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