Industrialization Of Fragment Production, Technology Diffusion And The Yangtze River Delta Region

In this article author tries to analyze the industrialization taken placed in Yangtze-River Delta from the view of fragmented production, a new conception which prevails in international trade during these years. Author aims at putting up a consistent logical explanation for the economic growth, technological advancement, slow development of service sectors, urbanization showed in the form of towns, and other economic phenomena happened in this area. In author's opinion, from the beginning to present development the local industrialization displays the obvious characteristic of fragmented production, i.e. exteriorly the factory seeks development as the role of auxiliary parts for big corporation, at the same time, and interiorly the factory tries to divide the working procedure as small as possible and by this way to promote the specialization. So in this article: (1) tries to analyze why this area chooses the pattern of fragmented production: the analysis is carried out from the studying of historic background and factor endowment; (2) explain the economic evolution happened in the pattern of fragmented production: because of choosing parts and components to begin the industrialization the autonomous enterprise can enter into the field in a very low cost. The fierce market competition provoked by a crowd of manufacturers lowers the price of parts and components, and this advantage attracts big corporation coming here and making investment. So the positive connections between them help the extension of industrial chains; (3) analyze the important roles fragmented production played in the advance progress of technology: the leader enterprises learn new technology from the big or foreign corporation and they are chased by so many followers. The pressure produced by followers force the leaders work harder and quicker to learn the newer technology. So the technological level of whole area is promoted; (4) study the influence of local governments and non-government organizations exerted on the local industrialization: they support the growth of local industries from grass-root situation by ways of financing, ground, and management etc. Until now they still make many measures to help the agglomeration of industries and the advance of enterprises in technology; (5) put forward a new explain for the paradox between quick development of industrialization and slow step of service sectors: if an area just takes the fragmentation of pure manufacture, the quick development of industrialization cannot increase the demand for service sectors such as finance, intermediate service, design, marketing etc. In fact the Chinese economy has the similar problems; (6) the pattern of fragmented production affects the urbanization as well: on the one hand the local industrialization eases the centralization of population towards megapolis, on the other hand for the similar industrial structure of near area, enforced by the negative effect of administrations' partition, the industries in different area show not cooperation but competition. Because of this point, some service sectors, which need big market size to get development, cannot grow up and the cities are more like town manufacture centers than just cities.