An Analysis On The Interaction Of Urbanization Development And Industrial Structure Evolution In Shandong, China

Urbanization and industrial structure upgrading work together in the regional economic development process and both are manifestation of regional economic progress. On one hand, orderly evolution of the industrial structure brings about changes in the motive mechanism of urbanization, urbanization patterns and urban forms, and thereby promotes the urbanization development. On the other hand, the urbanization development affects regional supply, demand and spatial allocation of resource elements, and thus acts on the industrial structure upgrade. Since reform and opening-up policy implementation, the urbanization rate of Shandong province has risen from13.6%in1978to50.9%in2011. Meantime, the industrial structure has been continuously optimized and upgraded. Non-farm employment proportion reached65.9%in2011, and in the respect of the output value ratio, the secondary industry has ranked the first, the tertiary industry second, and the primary industry third. However, as one of the major provinces of economy in China, whose GDP has ranked the third in recent years, the urbanization rate was only located in the15th in2011, and even below national average level. In terms of industrial structure, primary industry employment ratio is still the highest, and the third industry development is relatively backward. This has restricted the sustained and healthy development of the economy in Shandong province.This article firstly makes a systematic comb on the literature of urbanization and industrial development, and then summarizes the trend of the urbanization and industrial structure evolution in Shandong province since the reform and opening up, analyzing the characteristics and reasons for each stage. On the basis of it, this article illustrates the correlation of the urbanization and industrial structure, and the deviation of both in the development process. Next, this paper analyzes the impact of industrial structure on urbanization development, and shows that the primary industry is the material basis for urbanization development, the second industry is the main force and the tertiary industry is the follow-up force. Moreover, further to inside of each industry, it explores the impact of urbanization development on production resources, product structure and the internal structure. Then, from the perspective of empirical test, the long-term mechanism involving urbanization, industrialization and tertiary industry development, as well as causal relation between the three factors are investigated by the method of cointegration analysis and error correction model. The empirical results indicate that the tertiary industry stimulates urbanization better than the second industry and long-term stationary equilibrium relationship between the three factors exists. In addition, the Granger causality test reveals that urbanization plays an important role in the industry evolution, but the hypothesis that the industrial structure evolution stimulates the urbanization is not been supported. At last, this paper profounds advice, including developing diversification of the third industry, enhancing manufacturing industry, reforming urban and rural household registration system and improving the power of leading cities.Previous studies on the interaction between urbanization and industrial structure analysis is generally relatively macroscopical and sweeping. In view of the actual situation in Shandong, this article makes full use of statistics and local actual case, and specifies the role of the interactive relationship. This research, to some extent, is instructive and meaningful to promote the urbanization development, urban agglomeration and adjustment of industrial structure in Shandong province. And so is for the country.