The Impact of City-County Consolidation on Rural Development : Focusing on the Change of City-County Consolidation and Residence Tax

최수진

doi:10.15793/kspr.2016.91..003

This study estimates growth effect of city-county consolidation employing three econometric models which are based on different assumptions. In the model based on Granger causality, economic growth effect is significantly derived from seven years after the city-county consolidation. In the difference-in-difference model, which controls time-invariant regional specific effect including initial condition, the growth effect is insignificant. However, in the Panel Random Effect model, which assumes that regional specific effect is random because it has been influenced from city-county consolidation and other events, the growth effect is highly significant. The time span of the research includes the 1997 financial crisis and a necessity arises to control its different influence on each region. Accordingly, the result of Panel Random Effect Model is more convincing and I conclude that city-county consolidation significantly encourages rural development. The analysis also illustrates that the growth is led by physical capital and human capital is insignificant in rural development and it implies that the government should support labor productivity and education in backward region.

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* 2021년 이후 발행 논문의 참고문헌은 현재 구축 중입니다.

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