Analysis On The Regional Differences Of The Industry Agglomeration In China

Based on a new economic geography framework, this paper reveals the relation between the regional disparity and the industry agglomeration in China. From the regional economic gap between the evolution and decomposition of the structure, it is revealed that the gap between the eastern coastal region and the central and western region is the gap of the level of manufacturing agglomeration between them in fact. The paper explores the causes of industry agglomeration in china by using the provincial panel data and puts forward some measures to develop the manufacturing industry in the central region.Firstly, industrial factors have been the key reason causing increasing wideness of regional economic disparity in China since 1978. Taking GDP as a main indicator, the dynamic changes of regional economic disparity, industrial composition and regional composition were analyzed among the period from1978 to 2007.The reasons which caused the regional disparity and its dynamics in Chinese economic growth were revealed through industrial structural change and regional concentration. It is revealed that the regional disparity of the second industrial growth determined the regional disparity of Chinese economic growth. To accelerate the manufacturing industry in central and western China may reduce the disparity, and therefore solving uneven distribution of regional non-agricultural industries is a key measure to reduce the regional disparity.Secondly, this paper explores the causes of industry agglomeration in china by using the provincial panel data during 1980-2004. The main findings are: (1) Coastal areas have geographical advantages of industrial development; (2) Economic opening, market scale, urbanization, human capital and infrastructure construction promote industry agglomeration. Our study contributes evidence from China to the New Economic Geography theory and finds that, besides economic geography, history condition also relates to industry agglomeration. This paper also improves the classical knowledge production function, designing a knowledge production function containing R&D and knowledge stack, introduces two factors, knowledge spillover in industry agglomeration and government sustaining strength, uses spatial panel data models, and analyses the innovative capacity of region high-tech industry. The result shows that the knowledge production function containing the R& D and knowledge stack can show up the relationship between input-output in knowledge production, and the industry agglomeration in the region and the knowledge spillover among regions influence the innovation production in region high-tech industry obviously. Thirdly, based on the enterprises spatial competition factors that add cost and spatial complementarily, two models of location choice are constructed in this paper. The agglomeration level of 20 two-digit manufacturing industry was measured by the concentration index of industrial space and CRn index in 2002-2005. The result indicates that the whole agglomeration level of China's manufacturing industry is raising continuously and find that some industries show higher degree of concentration in the eastern China , but some industries characterized of scale and scope economies are less concentrated. This paper also analyses the formation mechanism of industry agglomeration from the perspective of the key enterprises.Finally, the paper analyses the comparative advantage of the manufacturing of the six provinces in central region based on the national data, put forward some measures to develop the manufacturing industry in the central region according the empirical study of combination of the above results and the comparative advantages of manufacturing of the central region.