| Since1978, China has maintained9.9%annual average growth of GDP and16.3%annual average growth of trade within32years. Why? This owes much to technological innovation, industrial upgrading, and industrial structure’s changes from low value-added agriculture to higher value-added manufacturing and services. Among them, the technological innovation and the industrial upgrading have played a very important role in raising total factor productivity. However, what is carrier for them? What is way for achieving them? And what are those policies for encouraging them? This paper, based on previous studies, aims to explore those factors related to the technological innovation and the industrial upgrading, and tries to answer these questions.Since China has adopted market economy in1979, a transformation of economic system has started---the transformation from planned economy to market one. Some scholars call it transition economy. This is the transformation in macro sense, or namely the "design" at top-level. Since the policy of Development Zone was implemented in1984, a relatively strict finacial incentive policy has been practicing among governments at all levels in China. Besides, powers concerning finance and administration are not balanced, which would finally affect administrators to make their decision of where the location of Development Zone would be when they implement finacial incentive policy. While the choice they made will further influence agglomeration and optimization of the whole industry, and even to its transformation.This paper, by reviewing the tax incentive policies of industrial agglomeration of Development Zone in developed countries,e.g. the United States, Japan and South Korea, and regions, such as the European Union, concluded that the policies are a series of measures taken commonly by governments in different countries and regions. It is generally recognized that the policies take government as main body, high-tech industry as supporting object, development zone as carrier, and achieving the optimization and upgrading of industry as its final goal. The ways of realizing development zone’s industrial agglomeration mainly lie in the support to high-tech innovation, package of government finacial incentive policies, including government purchase of high-tech products, allocation of R&D subsidies,etc. These policies can reduce risk that micro main body (enterprises) may face when implementing independent innovation, especially uncertainty from market demand.To further explore what impact the financial incentive policies have on the development zone’s industrial agglomeration,5major indexes and some typical development zones within3regions (East, Middle and West) in China have been selected as samples to be studied. The5indexs are:total financial expenditure, total revenues, total tax return, gross revenue share of GDP, the proportion of expenditure in science and education accounting for the total. And by the data obtained from2001and2011, numerical simulation was done on theoretical models. The results are as follows:First, concerning aspects of total financial expenditure indicator system and industrial agglomeration indicator system, when finacial expenditure of development zone increases every one hundred million, the level of industrial agglomeration in eastern development zones would be higher than those in the central and western Development Zone.Secondly, concerning aspects of total revenue and industrial agglomeration index system, in the eastern region the total fiscal revenue of development zone is positively correlated to industrial agglomeration, while in Chongqing Development Zone in the western region, negatively correlated.Thirdly, from the analysis of the simulating modles above, the Development Zone tax return to total financial expenditure, education expenditure proportion of total level and the proportion of total fiscal expenditure, industry agglomeration, although with the Development Zone tax return to total fiscal expenditure proportion of total gradually increase, the Development Zone in the East, West, industrial agglomeration level of total and industrial agglomeration level of total growth rate two aspects have a certain growth rate, but because of public infrastructure facilities have certain differences in different regions, and also is the tax refund the total fiscal expenditure proportion of total1million units, while the central area of Hubei Development Zone Industrial agglomeration level of total general respectively higher than the East and West Development.Therefore,some constructive suggestions concerning industrial-agglomeration of development zone in China are put forward to in this paper.The essential goals are:strengthening industrial agglomeration of enterprises in Development Zone to achieve further divisions; promoting agglomeration of some typical industries to develop with much specialization, diversification and interaction, and making a rational distribution; promoting introduction of technology and innovation of the enterprises in the Development Zone, and strengthening agglomeration of the high-tech industries.Secondly, the basic principles of Industrial agglomeration financial incentives:the principle of coordinated development of fiscal policy and industrial agglomeration and industrial upgrading; the principles of tax incentives for the development zone industrial clustering capabilities with public financial assistance to adptat; To adapt the principles of innovation characteristics.Againly, the general idea of financial incentives for Industrial agglomeration:In accordance with the characteristics of innovation;adhere to integration of the integrity of supporting link and the focus of supportv;Systematic planning, designing tax support policies; Policy support focus from re-introduction, digestion and absorption of light to the introduction and digestion of both, focus on improving the ability of independent R&D transformation; Guiding enterprises to introduce technology and to absorpt it; By absorbing innovation, Cooperation and innovation; Efforts to improve the capability of independent innovation in demonstration zone.Finally, the near and mid-fiscal incentives and tax incentives proposal of promoting industrial agglomeration in zone, On the one hand, Fiscal incentives mainly in the following several:to increase fiscal policy supportion of the national strategic and emerging industries,in order to promote strategic industries accelerated agglomeration; to further standardize financial supportion for the key areas and key projects, in order to optimize structure of financial for the industrial agglomeration; to further improve the mechanism of business incubators or fiscal policy in High-tech Development Zone, in order to accelerate the pace of high-tech industrial agglomeration;to improve the fiscal policy for production, study and research integrated development in development zone; in order to promote the agglomeration.of technology research, development and transformation,and so on; to build a diversified risk investment and financing system. for industrial agglomeration in development; to further improving and supporting the social security system for industrial agglomeration in development zone. On the other hand, tax incentives are the following:to further promote the value-added tax reform, in order to accelerate industrial upgrading in development zone; to further improve the existing preferential tax policies to promote the agglomeration of independent research and innovation of enterprise or industry in developmen; To further improve the export tax rebating policy, in order to promote the diffusion of high technology to the international market; to take tax concessions for transfermation of technology and transforming part it in development zone,in order to promote the agglomeration of scientific and technological achievements in zone;to take of tax incentives of introduction for high-level personnel, in order to promote the concentration of talent in zone; to take some tax incentives for entrepreneurs to invest in zone, in order to promote the accumulation of Venture Capital. |
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