Theoretical And Empirical Study Of Service Outsourcing Industrial Agglomeration

With the advancement of science and technology, the global outsourcing industry has being developed rapidly. Nowadays, various types of agencies whose manufacturing and trading activities are organized through coordination amongst themselves, take the way of inter-enterprise collaboration to organize the production and trading activities. Meanwhile, outsourcing industrial cluster has become one of the basic forms of the industrial organization of the service outsourcing industrial organizations. With the development of outsourcing industry in China, many researches approves that the industry has been affected by many factors, such as policies, the condition of market, social environment, unique problems of outsourcing enterprises and the differences of science and technology between districts, and so on. Undoubtedly, it is necessary to study further on the problems existing in the industrial agglomeration to promote feasible and sustainable development of outsourcing industry.Because of being different between outsourcing industry and traditional manufacturing industry, the development of service outsourcing industrial agglomeration has been influenced by effects of preferential policies and market incentives. Contrast to manufacturing industry, the study of theoretical micro-mechanism of outsourcing industrial agglomeration is rather lacking. Hence, based on theories of industrial organization and spatial economics, the paper is to reveal the micro-mechanism of outsourcing industrial agglomeration in order to interpret the driving forces of constantly self-intensification of the agglomeration. In the paper, the stimulus mechanism is divided into self-organizing mechanism and other-organizing mechanism. The former refers to market mechanism while the latter refers to policy mechanism. Correspondingly, the agglomeration of outsourcing industry is to obtain "market rent" and "policy rent" provided by industrial agglomeration.This study adopts related theories of spatial economics, especially the theory of Hotelling and Center-Periphery Theory, to establish an analytical framework of sole enterprise’s location choice and another framework connected to double cluster location competition from the perspective of both macrocosm and microcosm. The analyzing results indicate that there exists competition effect on the agglomeration rent provided for tenant enterprises by different types of outsourcing industrial agglomeration, and the relationship between "market rent" and "policy rent" are competitive and interactive. Both market mechanism and policy mechanism have the threshold effects. One direct correlated factor with the threshold effect is that industrial agglomeration has strong stickiness, which means if the power of market or policy is weak, it is difficult to transform one existing industry layout, which is originated from the fact that industrial agglomeration can produce agglomeration rent. Lastly, the paper adopts the conclusion of theoretical analysis and further examines the hypothesis based on the scaling data collected through the designed outsourcing industrial agglomeration mechanism. The results show that the effect of "policy rent" and "market rent" on outsourcing industrial agglomeration is both competitive and interactive. In the long term, the effect of "market rent" on outsourcing industrial agglomeration is greater than that of "policy rent". However, the "policy rent" can strengthen the positive effect of "market rent" on outsourcing industrial agglomeration and the "market rent" can also strengthen the positive effect of "policy rent" on outsourcing industrial agglomeration. The analyzing result proves further that there is U-shaped non-linear relationship between "policy rent" and economic performance of enterprises of the agglomeration in the long-term, which indicates the existence of threshold effect. However, the threshold effect of market is to be further verified by empirical research.In short, the paper probes into the mechanism of outsourcing industrial agglomeration by theoretical model and field investigation and finds out the key factors affecting outsourcing industrial agglomeration. Furthermore, it carries out the empirical examination on the outsourcing industrial agglomeration mechanism based on the hypothesis of "market rent" and "policy rent" of outsourcing industrial agglomeration. In the end, based on the conclusion of theories and investigation on the empirical results, it offers relevant suggestions on policies.