An Empirical Study Of Industrial Structure Optimization And Economic Growth In Yangtze River Delta Region

After the global financial crisis in2007,exposing to many developed countries, such as the United States and Britain, re-implementing industrialization strategy to construct new industrial structure, Yangtze River Delta which has strong industrial foundation has to rethink about how to choose the future way for advancing industry. As a highlight of the industrial structure studies, industrial structure optimization would be an important research field for Yangtze River Delta. In this context, from the perspective of economic growth the paper has analyzed the status quo and development of industrial structure in Yangtze River Delta, and through applying panel data and time-series data this paper also has conducted empirical analysis on connection between economic growth and rationalization of industrial structure/upgrading of industrial structure, both constituting the optimization of industrial structure.On the basis of comparative analysis of industrial structure’s status quo of16core cities in Yangtze River Delta and of Shanghai, Jiangsu and Zhejiang, it shows the Yangtze River Delta’s economic power in China and the close connection between the order of secondary, tertiary, primary industry and sustaining abundant industrial foundation. Manufacturing sector which attaches to secondary industry is the most important industry creating jobs in Yangtze River Delta. Among manufacturing sector, communication equipment, computers and other electronic equipment manufacturing industry, transportation equipment manufacturing industry, and textile industry are the three most competitive industries. However, except the similarity of tertiary industry, different from the traditional theory that existed similarity of manufacturing industry in Yangtze River Delta, almost each city holds its own dominant industry. Thus, the geographical proximity in Yangtze River Delta can bring about the positive effect due to industrial interaction among different cities; further, Shanghai and Jiangsu being the two centers of Yangtze River Delta have demonstration effect in allocating rationally resources and optimizing industrial structure. On the other side, the analysis on development of industrial structure in Yangtze River Delta states that economy has been boosted in turn by secondary industry or tertiary industry since the reform and opening up. And the fluctuation of whole economy and of tertiary industry becomes more and more parallel, which indicates the coordinated trend between upgrading of industrial structure and economic growth.Imperial analysis states the insignificant effect of industrial structure optimization, which has not produced positive effect of structure promoting economy. First, the insufficiency of industrial structure rationalization displays no synergistic effect of the three industries via factors mobility in these industries. Specifically, from the perspective of capital allocation, when capital injecting to primary, secondary, and tertiary industry alone each industry can facilitate economy individually. But interaction of three industries would restrain economy or does not show any beneficial function to economy. From the perspective of labor allocation, only primary industry promotes economy and secondary industry and tertiary industry have no distinct effect. Meanwhile, interaction of three industries has nothing to do with boosting economy. In addition, Yangtze River Delta has maintained the tendency of upgrading of industrial structure in the past20-year. Although in long-run there is a synergistic and balanced relationship between upgrading of industrial structure and economic growth, in short-run the adjustment of economic growth lags behind the adjustment of industrial structure upgrading, and flexibility between the two in short-term is smaller than in long-term. Therefore, when it comes to the industry policy, combining the urbanization and upgrading of industrial structure would achieve synchronization in both two indexes.