Officials’ hometown connections and interprovincial trade in China: based on the perspective of hometown favoritism

This study examines the impact of officials’ hometown connections on interprovincial trade in China, emphasising local officials’ favouritism towards their hometowns. Utilising the detailed curriculum vitae of provincial leaders along with railway trade data for province pairs, the paper finds that provincial governors significantly enhance bilateral trade with their hometowns by 14.0%. Further analysis reveals that governors augment final goods imports by 19.4% and raw resources exports by 17% with their hometowns, while exhibiting a less significant influence on final goods exports and raw resources imports. These findings suggest that local leaders may allocate portions of monopoly markets and raw resources to favour their hometowns. Moreover, differences in industrial structures appear to amplify the impact of hometown connections, while officials’ promotion pressures may mitigate this effect. This study contributes new insights into the spillover effects of hometown connections, thus combining the existing literature on hometown favouritism and local protectionism.