Research On Industrial Development Gap Between Guangdong And Guangxi:A Perspective Based On Agglomeration Economies

Based on agglomeration economies theory and methods of regional system planning, this thesis firstly researches the industrial development gap between Guangdong and Guangxi, then explain the causes for the differences in industrial structure by the mechanism of Pecuniary Externalities and Technology Externalities. The main conclusions and policy enlightenments are as follows:About factor input. The factor input structure of Guangdong is better than Guangxi. The industry development in Guangdong is driven by science and technology input, while it is mainly driven by capital in Guangxi.About industrial structure. Guangdong has more high-tech industries which highly cluster in Pearl River Delta region (about88%of industrial output), by contrast, most pillar industries in Guangxi are resource-oriented or related to agriculture, which distribute dispersedly. The industry in Pearl River Delta is dispersing, meanwhile industry in Guangxi is gathering toward Beibu Gulf.About environment. There is a significant difference in industrial structure ownership between Guangdong and Guangxi:foreign firms play a dominant role in Guangdong, while state-owned firms is still in a leading position in Guangxi. Guangdong’s market size is much bigger than Guangxi and there is few differences of industrial market efficiency between Guangdong and Guangxi. About function. There is still a significant gap of industrial scale between Guangdong and Guangxi, but the gap in industrial contribution to regional economic and output efficiency is narrowing.The initial gap is due to the different positions of Guangdong and Guangxi in reform and opening. The gap is growing under the effect of Pecuniary Externalities mechanism and circular and cumulative process. These are the main reasons why Guangdong is much more developed in industry than Guangxi.Because of lower stage of industrial development, there is significant agglomeration economies in Guangxi, especially the specialization economy, this maybe the main factor which drive industrial distribution change in Guangxi. There is also a signal shows that industry is excessive agglomeration in Guangdong, but the diversity economy is still promoting its industrial agglomeration. Excessive agglomeration and diversity economy maybe the main reason for the industrial structure changes in Guangdong.Based on theoretical and empirical results, there are two policy suggestions proposed for Guangxi’s future development:first, attracting skilled labor and improving the infrastructure are two possible ways tc break the historical "core-periphery" structure between Guangdong and Guangxi. Second, promoting the industrial agglomeration in Beibu Gulf is beneficial for the long-term development in Guangxi.