Industrial Agglomeration And Regional Unbalance Of Economic Development: Theoretic Study And China's Experience

Industrialization is an important research domain in development economics. The early development economics once researched the unbalanced industrialization in space, and proposed "geographical dual economy" and "growth poles", and so on. After 1990s, economists were beginning to interest in the important influence of spatial factors on economic theory and economic activities, and the new economic geography became one of the hot spots in economic research. At the same time, the literatures in the last few years researched thoroughly the accumulative effect in development economics. Based on existed research results, this dissertation analyzes the rules of industrial agglomeration in developing countries and the industrial agglomeration's influence on unbalanced development.One of the important characteristics of developing countries is still the dual economic structure. In order to describe the structure characteristics of industry in developing countries, the dissertation further subdivides industry into technology-restrained industry and capital-restrained industry. Technology-restrained industry gathers in the regions in which facilitate them obtaining technological capabilities. Capital- restrained industries choose the region based on the market access principle. Thus, we develop a D-S model of the new geographical economics that has the constitutive character in developing countries. This approach is powerful in its ability to analyze industrial agglomeration in developing countries. Because of their capabilities in obtaining technological capabilities and access to market, the industries displays a tendency to agglomeration in developing countries. If agglomeration costs are considered, there is a kind of impelling force for the industry agglomeration regions to diffuse in space. During the development of the technology-restrained industry and industry upgrading, there are two kinds of tendency in industrial agglomeration in developing countries: The elements of production gather to industrial agglomeration regions, and industrial agglomeration regions diffuse in space. The diffusion does notfollow "concentration followed by decentralization", but follow "concentrated decentralization". In the course of "concentrated decentralization", the agglomeration powers are more powerful than the diffusion powers. Thus, industrial agglomeration is always excessive in developing countries. As the result, we must carry on the regional policies to the economical development to guide industry agglomeration to diffuse scientifically, which is essential for the sustainable development of industrial agglomerations and the industrialization of backward regions. The study discovers that the rules of industrial agglomeration can explain the rules of unbalanced development in the developing countries. The dissertation analyzes empirically the industrial agglomeration and economic development in China, and empirical evidence supports theory conclusions.The dissertation has seven chapters:Chapter one is the summary of the research of industrial agglomeration. The early economics has already noted that industry has a kind of tendency of unbalanced development. The initiator of neoclassic school, Alfred Marshall, studied thoroughly industrial agglomeration phenomena. Until now, Alfred Marshall original exposition of the concept of external economies is illustrated in the research of industrial agglomeration. The dissertation is based on the thoughts about unbalanced development and linkage effects of industrialization in early development economics. The methods of the new geographical economics and the recent research of the accumulative effect in development economics provide the methodology support for this paper.Chapter two carries on the analysis of the structure characteristics of developing countries. Agricultural, technology-restrained industry and capital- restrained industry are introduced into the D-S model to develop a model of the industry agglomeration in developing countries. This chapter analyzes the short-term equilibrium of the model, and finds that obtaining technological abilities and accessing market impel industrial agglomeration.Chapter three analyzes the dynamic changes of the influencing factors in industry agglomeration. The cumulative cycling process of technological abilities will inducethe ultra-backwash effect in the technology-restrained industry agglomeration. Further, the mutual effects between the technology-restrained industry and the capital-restrained industry will cause excessive agglomeration. For the technology-restrained industry, the regional infrastructure improvement raises the wage of skilled worker regardless of where the input comes from. For the capital- restrained industry, regional infrastructure improvement caused by the shift payment increases relatively the quantity of the capital- restrained industry in the favored region. Finally, under the agglomeration costs considered, we find the "concentrated decentralization" rule in industrial agglomeration in developing countries.Chapter four reviews the history of regional characteristics of the industrialization in China, the change tendency of regional industrialization levels and the industrial agglomeration phenomena during the unbalanced development of industry in China after the 1990s. We analyze empirically the factors affecting the regional industrialization levels in China. Through the empirical analysis of the industrial agglomeration degrees and industrialization levels in every province, three industrial agglomeration regions, and three regions (east, center, and west), We find that China has industrial agglomeration and "concentrated decentralization" phenomena in China. Regression analysis and correlation analysis support theoretical analysis's conclusions about factors affecting to industrial agglomeration.Chapter five proves that the rules of industrial agglomeration are important factors, which affecting the unbalanced development in developing countries. The difference of industrialization level between regions affects the difference of the economic growth and the accumulation of capital between regions. Industry agglomeration leads to conditional convergence, the tendency of regional income inequality, affects the regional inequality of individual welfare. The chapter analyzes empirically the unbalanced development in China. Regression analysis shows that the province with higher industrialization level grows faster and the industrialization level significantly affects the accumulation of capital in every province.From the views of the different types of technology progress and institutioneconomics, chapter six further analyzes some questions not being analyzed in the above model. In this chapter, technology progress is divided into two kinds: technology progress in the same technology generation and between different technology generations. The former will result in "concentrated decentralization" of industrial agglomeration region; the latter will result in industrial agglomeration shifting from one region to another region. For industry agglomeration, the institution innovation and imitation is "the double-edged sword". Not only does it impel "concentrated decentralization", On the other hand, but also create opportunities for the backward region to exert backward advantages in institution.Chapter seven summarizes the main conclusions and proposes what we must pay attention to in the course of industrial agglomeration and unbalanced development. We must impel region integration in the course of industrial agglomeration, induce scientific diffusion and sustainable development of industry agglomeration, enlarge investment to human capital outside industrial agglomeration, promote impartiality between regions through financial shift payment, exert backward advantages for backward regions to catches up.