A Study Of The Mechanism Of Local Market Potential And Protectionism On Urban Exports

The Sino-US trade conflict,the new crown pneumonia outbreak and the "anti-globalization" trend have brought great impact to the economic development of Chinese cities with high foreign trade dependence,and the export-oriented cities’ economy has slowed down.In order to explore new dynamics of export growth at the city level,this paper analyzes the impact of regional market potential and local protectionism on city exports and their transmission paths,taking regional market potential and local protectionism as research perspectives,combining labor mobility effect,innovation and entrepreneurship effect,manufacturing development effect and enterprise survival effect,and focuses on how regional market potential and local protectionism interact to influence city export network.Using city-state pair trade data from 2003-2016,this paper examines the degree of influence and mechanism of action of market potential and local protectionism on city exports through OLS and PPML models.It is found that(1)urban market potential significantly promotes urban exports,while local protectionism significantly hinders urban exports.(2)Regional market potential affects urban exports through three paths: labor inflow effect,innovation and entrepreneurship effect,and manufacturing development effect.Local protectionism affects urban exports through three paths: labor inflow effect,innovation and entrepreneurship effect,and firm survival effect.(3)The "predatory hand" of local protectionism significantly weakens the positive impact of market potential on exports,and the export promotion effect of market potential decreases in cities with stronger local protectionism.(4)The weakening effect of local protectionism on exports is stronger in cities with more “GDP cascades”and diverse dialects,and the positive effect of market potential on exports is more pronounced in cities with “GDP cascades” and diverse dialects.(5)There is significant regional heterogeneity in the effect of local protectionism on exports,which is more pronounced in the central and western and non-coastal regions.The above results still hold after using the shift-share instrumental variable method and a series of robustness and heterogeneity tests.This study reveals the role of regional market potential in promoting exports and the role of local protectionism in inhibiting exports,providing a new theoretical perspective for analyzing urban export slowdown and empirical evidence for further enhancing urban export dynamics.