Research On High-end Service Industry Agglomeration Formation Mechanism And Agglomeration Effects Of China

High-end service industry has a strong knowledge spillover effect. Because it can effectively drive the development of three industry and achieve transformation and upgrading of economy, it has become the vigorously developing industry of all the countries in the world. However, lag of development of high-end service industry in China has seriously restricted the economic transformation and upgrading of our country. Especially the leading role of the manufacturing and service industries is not fully played out. With the adjustment of industrial structure and economic transformation and upgrading in China, high-end service industry has become the focus of the next phase of China’s development. And agglomeration development is an important direction for the development of high-end service industry. In this paper, we take the spatial agglomeration of high-end service industry as the research object and take the two aspects of influencing factors of agglomeration and agglomeration effect in the high-end service industry as main line. Using basic theory of new economic geography and spatial econometrics method, we have carried on the thorough analysis and the verification to the high-end service industry agglomeration’s changing tendency, formation mechanism, influence factor and the gathering effect and so on.In the aspect of theoretical research, mainly basing on the double growth model of knowledge spillover(KSIBI model), the paper has made two amendments according to the characteristics of high-end service industry. First, it revises the generalized transportation cost in the new economic geography model to the cost of information transfer. Secondly,it revises the knowledge spillover function hypothesis in KSIBI model. On the basis of this, we built a theoretical framework of the formation mechanism and the agglomeration’s effect of high-end service industry. The model shows that the stable state of the spatial distribution of the high-end service industry is related to the degree of free trade and the degree of the high-end knowledge spillover. With the improvement of trade freedom, the distribution of high-end service industry undergoes three stages: symmetric equilibrium, symmetrical balance and core-edge balanced coexistence stage, core-edge equilibrium. When in the stage of symmetric equilibrium the improvement of trade freedom promotes the growth speed of high-end resources and economy. While in the stage of core-marginal equilibrium high-end resources and economic growth speed have nothing to do with the trade freedom. The high-end resource growth rate and economic growth rate of the core-marginal equilibrium are greater than the high-end resource growth rate and economic growth rate of the symmetric equilibrium. It shows that the agglomeration of high-end service industry has improved the economic growth rate. In addition, under the condition of symmetric equilibrium and core-marginal equilibrium, high-end resource growth and economic growth are positive correlation to high-end resource openness, degree of free trade, the number of labor and market share. But they negatively correlate with the capital depreciation rate, elasticity of substitution between products and discount rate of capital return rate. In addition, in the case of trade freedom keeping unchanged, an increase in the degree of the high-end knowledge spillover will lead to the distribution of high-end service industry from the state of agglomeration into a dispersion state. At the same time the model has proved when the high-end knowledge is not fully diffused, high end service industry’s agglomeration can promote the upgrading of the manufacturing industry. It has also proved that under the condition of maintaining the agglomeration degree of high-end service industry unchanged, by enhancing the spillover intensity of regional high-end knowledge, it can promote the improvement of upgrading speed of the whole economy of modern manufacturing industry.In the empirical research aspect, first, it is the measurement of high-end service industry and its sub industry agglomeration degree. Using spatial Gini coefficient, location quotient, Herfindahl coefficient, improved spatial clustering index, from the provincial level this paper has measured the changing trend of the national high-end service industry agglomeration’s degree since 2003. From the measured results we can see that high-end service industry and its sub industry agglomeration level are not high, the advancement of agglomeration degree is not significant and even has appeared downward trend in recent years. We can also see that in most years the agglomeration degree of High end service industry from high to low in order for business services, information services, research and development services, financial industry. Seeing from the East, the Middle and the West, high-end service industry and its sub industry agglomeration’s degree are both at the highest level in the East, which shows the distribution structure of taking the East as core and the Central and Western as periphery.Secondly, basing on the model built, this paper has put forward influencing factor hypothesis of high-end service industry agglomeration. It has also quantitativly analysed and validated the influencing factors of China’s high-end service industry and its sub industrial agglomeration by using exploratory spatial data analysis and spatial panel data method. Some research has showed that there is obvious spatial positive correlation between the development of agglomeration of the high-end service industries and its sub industries in all provinces. And each factor has certain difference on the influential degree and direction of the high-end service industry and its sub industry.Thirdly, in the aspect of agglomeration effect of high-end service industry, the paper bases on the most essential function of high-end service industry. Using exploratory spatial data analysis method and the spatial panel data method,the paper carries out quantitative analysis and verification to high-end service industry agglomeration to promote manufacturing industry upgrading and high-end service industry agglomeration to promote its industrial competitiveness improvement. Relevant research shows that there is a positive spatial correlation between upgrading of manufacturing industry in China at the provincial level. And its spatial positive correlation is mainly manifested in the correlation among regions. The strong spatial dependence’s effect has been formed among adjacent provinces. The improvement of agglomeration degree of the high-end service industry and its sub industry shows a significant promoting effect in the manufacturing industry. Its impact on upgrading of manufacturing industry is mainly manifested in the regional differences and the time dimension is not obvious. It is a result that the differential regional effects are greater than the differential effects caused by time variation and high-end service industry as a whole promotes upgrading of manufacturing industry more greatly. There is a significant spatial positive correlation between the high-end service industry and its sub industry competitiveness in China’s provinces. There is obvious polarization among provinces. It totally presents a phenomenon of low-end agglomeration. The improvement of agglomeration degree of high-end service industry or its sub industry in our country significantly improves the competitiveness of their own whether in space or time. And the improvement is more significant at the time level. At the same time, it verified that partial control variables have impact on upgrading of manufacturing industry and high-end service industry and its sub industry competitiveness.In the end, according to the research conclusions of this paper, the paper puts forward some policy recommendations to promote the development of China’s high-end service industry agglomeration.There is main innovation in this paper. In theoretical aspect, the concept of the high-end service industry is redefined, and using the new economic geography theory and modifying the double growth model of knowledge spillover, the model of high-end service industry agglomeration formation mechanism and agglomeration effects is constructed, which provides a theoretical framework for the study high-end service industry agglomeration of China. In empirical aspect, under the premise of the space effect, the formation mechanism and the agglomeration effect of high-end service industry agglomeration in our country are verified by the exploratory spatial analysis and spatial econometric model method. Some useful conclusions have been obtained, which provides a strong empirical evidence for the development of high-end service industry agglomeration of China.