Economic Function Districts, Factor Agglomeration And Quality Of China's Manufacturing Export Products

Growth in trade is an important manifestation of economic globalization,and industrial products account for a large part of global trade.Since the beginning of 21 st century,the economic growth in developed countries depends less and less on manufacturing,which remains the important pillar of economy in developing countries.For a long time,we designed our industry structure on the basis of the comparative advantages of our natural resources,which mainly focused on labor-intensive and resource-intensive industries.Therefore,we have been at the medium and low end of the global value chain,neither to optimize the trade structure,nor narrow the gap with developed countries in product quality.Along with the gradual deregulation in some cities and regions,the national economic function areas have been built up by the government,rationed preferential policies.The phenomenon also gives us a new perspective of thinking on what the function districts will effect up on the quality of export products.There is a great extension of trade theory by the new insight of factors agglomeration.The paper is divided into seven chapters.In Chapter 1,the research background,the research significance,the content and method of this thesis are briefly reviewed.While in Chapter 2,by reading the domestic and foreign literature review,we can well know about the current mainstream of the development trend and research limitations.That is valuable for our research about the theoretical construction,model analysis and methods.And we tried to show an empirical relationship between Chinese export product quality and the functional areas.Chapter 3 introduces a historical review of the evolution of Chinese export products quality and the development of economic function areas in China.The development of China's economic function districts experienced a process from small to big,from the points to the plane,with their unique geographical advantage and the better economic mechanisms.They have been promoting the smooth implementation of the policy of reform and opening to the outside world,to accelerate the pace of China's economic growth.Nevertheless,public opinions about the history of China's export products quality were divergent.Because of the difference of the limitations of the data and the difference in statistical methods,researchers got different conclusions,which caused my curiosity and research interest.In Chapter 4,based on the predecessors' research,I also try to show the mechanism about the function areas how to impact on export products quality.In fact,on account of inter-regional factors flow and economic agglomeration,we want to know what effect the manufacturing export products quality.The two chapters are empirical study,Chapter 5 and Chapter 6.China economic function districts are self-executive,independent of administrative territory,and then gradually accumulated as a gathering place for industrial development.These regions not only have administratively distinct geographical boundaries,their policies also has clear boundary limits,which are good for studying the characteristics of the function areas and their influence on enterprises' export products quality.As the window and the navigator of the country's reform and opening up,these regions enjoy the national preferential policies,such as tax incentives,government subsidies.Therefore,with the help of China's industrial enterprises database and the customs database of the “Enterprise import-export products”(2000-2006),we generated a new manufacturing export enterprise database and used PSM-DID in this study.Chapter 5 examines the influence of overall economic aggregation about the export products quality.According to the full sample regression results,the function areas contribute significantly to the quality of export products.Due to the different allocative efficiency,different regions play different role,actually they also have different influence.Therefore,dealing with different areas and different manufacturing sectors,the impact of non-coastal regions is not significant,while the eastern coastal economic function is most significantly positive to the technology-intensive enterprises export products quality.Then,inspired by previous literatures,we take into account the time lag may exist for enterprises to enter the function areas.It means entering the special regions may be more useful on the quality of export products after a period of time.In the empirical analysis,we have found the promotional effect presents a clear curve: first rise then fall.These conclusions lead us to think about what the reason is,and how to prove it.Keep researching by the use of the PSM-DID,in Chapter 6,we attempt to explore the real reason from the perspective of the advantages of the factors agglomeration to see the whole story.First,in order to test the effect on the export quality by the capital element,we measure the capital element accumulation with the ratio of FDI,as sign mark “fdibl”.At this time,the treatment group is the exporters in function area,while the control group included all non-function area enterprises after matching.The control variables are the same as Chapter 5,including:(1)sales revenue;(2)the number of employees;(3)total assets;(4)per capita wage;(5)financial situation;(6)profit rate;(7)the firm's age.And the fixed effects include time fixed effects,industry fixed effects and region fixed effects,the interaction coefficient is significantly negative actually.In the subsequent analysis,we find out the reasons,capital as a factor of production in global flows are concerned about their own profit maximization other than the earnings of the host country.So we can see the FDI is significantly negative.In the section of studying the technical factor,we used TFP(Total Factor Productivity)as a measure of technical elements variables,instead of the traditional measuring method.Because TFP reflects the “residual” factors contribution after deducting the tangible factors contribution,which is generally understood as intangible(invisible)factors contribution,such as technology.In order to avoid the selection bias and the simultaneous bias,we choose the LP algorithm to estimate the TFP.After dealing with a series of control variables and fixed effects,we see the technological innovation elements as co-factors could improve the quality of export products.The coefficient variation becomes more significant and larger.For measuring factors allocation,by the aid of referring Ms.Yang's method,we use a multi-dimensionally combinatorial index to measure financing capacity and financing channels information.So we construct a comprehensive index system including nine indicators,to measure the enterprises' various financing constraints.The common point of the value of these nine indicators is: the larger,the better.Then we test the comprehensive score.When the value of this score are larger,that means the financing constraints are smaller.Finally,we see the coefficient of the interaction term is significant positive,which means comparing to the non-functional districts,those enterprises in the area got their export products quality promotion.That benefits from relaxing financial constraints.In Chapter 7,we present the main findings and the policy recommendations.The limitations and deficiencies of the research are summarized,and the future research direction is discussed.We summarize the main conclusions as follows: for the whole sample,the overall economic functional area has a significant positive effect on the quality of manufacturing export products.The coastal functional areas play a significant role in promoting the quality of export products,but the "functional area effect" is not a powerful explanation for the quality improvement of export products in non-coastal areas.The economic function area is a integration of various production factors and a integration of economic activities at different levels,and the heterogeneity of the economic functional areas leads to a heterogeneous economy.Furthermore,this paper proposes some policy suggestions on how to improve the appropriate configuration and scientific management of production factors in the economic functional areas,so that it can help to improve the quality of China's manufacturing exports.We have several innovations.First,it dissected the mechanism of the influence of the policy design of economic functional areas on the quality of export products of China's manufacturing industry.The paper used county-level data,which are more granular than the city-level data normally used by other literatures.The paper also considered synergistic effect among various production factors including labor factors,capital factor,technology factor and resource allocation effect.The second innovation of the paper is its novel theoretical model,which utilized the basic trade theory to derive the transmission mechanism among economic functional areas,factor mobility and export quality upgrading.The model also used mathematical formulas to intuitively and vividly summarize the underlying relations of the quality of export products and the policy design and describe the objective phenomena.Third,the paper used more appropriate quantitative method,which avoided endogeneity problems and ensured the accuracy and stability of measurement results.Based on the research of the quality of export products,we have found an interesting explanatory variable which is economic functional districts with Chinese characteristics.Original discovered after the reform and opening up,China has established various economic functional districts,not only reflects a common vision of the national macro strategic planning and the regional development aspiration,but also bring significant influence onto enhancing the quality of export products.And we find this positive impact due to the advantages of factors agglomeration.For this reason,there is an important theoretical and practical significance for the development of our professional subject and the formulation of national policies.