Work

Spatial concentration of manufacturing firms in China

Year: 2016

Type: article

Abstract: Applying the methodology developed by Duranton and Overman, we analyse localization and dispersion of firms in China. Using a unique and detailed dataset on manufacturing firms in China, we are able to follow the changes in location patterns of firms between 2002 and 2008. Our analysis shows that firms in China are more localized than in the UK or Japan. Localization is comparable to that in the US, and takes place at relatively small scales that are consistent with the size of Chinese cities. Localization increases rapidly, even in the relative short period between 2002 and 2008, especially new entrants localize. Private firms, firms from Hong-Kong, Macao and Taiwan, and foreign firms are more localized than state-owned firms. Our findings are consistent with the notion that China is increasingly liberalizing its economy, enabling (profit seeking) manufacturing firms to benefit from agglomeration economies.

Source: Papers of the Regional Science Association

DOI: 10.1111/pirs.12195

Authors: Steven Brakman, Harry Garretsen, Zhao Zhao

Institutions: Ifo Institute for Economic Research, University of Groningen, Radboud University Nijmegen, Utrecht University

Language: English

Topic: Regional Economics and Spatial Analysis

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Decent work and economic growth, Industry, innovation and infrastructure

Open Access status: hybrid

Estimated APC paid: $2,740