Is the natural resource production a blessing or curse for China's urbanization? Evidence from a space-time panel data model

This paper provides an analytical framework to evaluate under what conditions the natural resource production could promote or hinder urbanization process, focusing on factors mostly relevant for China. Considering both structure breaks and cross-sectional dependence as well as spatial spillovers, the study deploys a comprehensive approach to rigorously prove the validity of the proposed space-time panel data model that includes the second generation panel unit root test and panel cointegration, panel threshold regression and spatial panel Durbin model. The results not only offer strong evidences that the natural resource production non-linearly impacts on urbanization process, but also show that there exists a dynamic response over time and space as well as space-time diffusion impact, in which these percentages are different from each other confirming an asymmetric effect of the natural resource production on urbanization process. (C) 2014 Elsevier B.V. All rights reserved.