The Effect Of Industrial Diversification On Regional Economic Development

In the context of economic globalization, faced with the inherent requirements of rapid economic growth and dramatic changes in the external market environment, how to adjust the industrial structure in order to achieve sustained and stable economic development is the important issue faced by each region. This article is based on the theoretical mechanisms of the impact of industrial diversification on regional economic development, and by using the entropy index method, industrial diversification is decomposed into related and unrelated to the two parts, also taking China’s prefecture-level city panel data from2003to2009as samples, the impact of related and unrelated diversification on regional economic development is examined from economic growth and economic stability in two dimensions and the results show related diversification has a significant promoting role in regional economic growth and economic stability, unrelated diversification is not conducive to economic growth, but help to improve economic stability.This paper introduces a new industry classification based on complex network in the industry, that is the clustering analysis method based on the industry association redrawing19kind of industry, than the entropy method is applied to measure the relevant and irrelevant diversification index of the282cities in our country, and on the basis the relationship between the diversity of industry and regional economic development has carried on the empirical test. To further examine the differences of the economic stable function from diversification under different macroeconomic situation, the phased regression is done with the global economic crisis as a dividing point, and the results show:When the external market is in good condition, the stabilizing effect of related diversification is more obvious, and when the event of external economic shocks, the stabilizing effect of related diversification is weakened or even reversed, but unrelated diversification has always played a function of economic stability.