An Empirical Evaluation of Traditional Chinese Village Exploitation on the Local Economy: Evidence from a National Cultural Policy

To overcome the difficulty of assessing cultural effects, we designed a quasi-natural experiment using a traditional Chinese village selection as cultural policy. Using county panel data from 2009 to 2017, we estimated the impact of traditional village exploitation on county economies using a staggered difference in differences (DID) model. The results showed that counties with national traditional villages have a significantly higher gross domestic product (GDP) and GDP per capita than the control group, with a yearly increasing trend. The heterogeneity analysis revealed that the effect of this cultural policy in the eastern, central, and western regions was very different. The impact was most significant in the less-developed regions of western China. This result indicates that cultural policies are advantageous for reducing regional developmental imbalances. The mechanism test also showed that the greater the distinctiveness and agglomeration of cultural resources, the greater the impact of traditional village exploitation on the county economy. In addition, we found that national 5A Scenery Sites do not have a driving effect, but rather a polarizing effect, on counties where traditional villages are located. Through a series of robustness tests, our conclusions hold true.