E2024006                  2024-07-17

Xiaochang Yan

CICC Global Institute, China International Capital Corporation

&

Yang Yao

China Center for Economic Research & National School of Development,

Peking University

Abstract
This paper finds a novel way to measure culture and its impacts on growth. Southern China has a distinctive culture than northern China. Southern culture is more pro-economic growth than northern culture. Southern officials moving to northern cities (northbound officials) bring southern culture with them. Deploying a comprehensive dataset covering all Chinese prefectural cities in the period 1994 – 2017, our empirical study finds northbound officials significantly outperform their northern peers by 0.94 percentage points. This result is robust when we take into account moves in other directions, officials’ promotion incentives, their ability, and their experience. Further analysis shows that northbound officials invest more and attract more people into their cities than their northern peers.

Keywords: Culture and growth, rice culture versus wheat culture, Chinese bureaucracy

JEL classification: O43, O15, P27

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