A study of industrial agglomeration and co- location in China Meng Tong Department of Economics, Birmingham This thesis is submitted to the University of Birmingham For the degree of Doctor of Philosophy University of Birmingham Research Archive e-theses repository This unpublished thesis/dissertation is copyright of the author and/or third parties. The intellectual property rights of the author or third parties in respect of this work are as defined by The Copyright Designs and Patents Act 1988 or as modified by any successor legislation. Any use made of information contained in this thesis/dissertation must be in accordance with that legislation and must be properly acknowledged. Further distribution or reproduction in any format is prohibited without the permission of the copyright holder. Acknowledgements Five years ago, I came to the University of Birmingham to attend a program, Master of International Money and Banking. After one year’s study and one year’s experience of being research assistant, I became a PhD Student in the Department of Economics. In the past four years, I received lots of generous help from many persons around. Firstly, I am heartily thankful to my Chief Supervisor, Prof. Robert J Elliott, whose encouragement, guidance and support from the initial to the final level enabled me to develop an understanding of the geographical concentration and regional economy subject. Many thanks to Prof. Robert J Elliott, his knowledge and insight gave me a strong support during my whole study, not only the academic work but also the daily life. Also thanks to my co-supervisor Dr. Nick Horsewood who gave me quite a lot of valuable suggestions and indications throughout my thesis. Special thanks go to Prof. Eric. A. Strobel and Dr. Michael Henry. Without their friendly help and encouragements, I could not make my thesis meaningful. Besides my supervisors, I would like to show my gratitude to the staff in the Department of Economics, as they inspired me a lot and shared their expertise with me. And I express my great thanks to Marleen, who offered her support in a number of ways. Many thanks also go to the fellows: Liyun Zhang, Bing Liu, Enrico, Charlie, also my wife, Yi Liu, who is also my classmate. I owe my deepest gratitude to their friendship and encouragement. Finally, I wish to thank my family, which provides the solid support to me. I share the achievement with my family members. 1 / 346 A study of industrial agglomeration and co-location in China 目录 A study of industrial agglomeration and co-location in China ..................................................... 2 Chapter 1. Introduction .............................................................................................................. 5 Chapter 2. The pattern of industrial agglomeration and changes Evidence from China ............. 11 Abstract ................................................................................................................................ 11 1. Introduction ......................................................................................................................... 13 2. Literature Review .................................................................................................................. 14 3. Measurement of agglomeration ............................................................................................. 19 3.1 A model of location choice ............................................................................................. 20 3.2 A sequential model of location choice ............................................................................. 23 4. Measurement of agglomeration ............................................................................................. 24 5. Data Description .................................................................................................................. 29 5. Patterns of industrial agglomeration in China ........................................................................ 33 5.1 Statistical analysis ............................................................................................................ 34 5.2 The concentration of production activities ...................................................................... 35 5.2.1. The regional inequality on manufacturing regional distribution ................................ 35 5.3 The magnitude of industrial agglomeration and its trends ................................................ 37 5.4. Patterns of industrial agglomeration ............................................................................... 39 5.5 The location of agglomeration......................................................................................... 42 5.6 The least agglomerated industries .................................................................................... 45 6. International comparisons ..................................................................................................... 46 7. The dynamics of agglomeration ............................................................................................ 50 8. Conclusions .......................................................................................................................... 56 Chapter 3. The Dynamics and determinants of industrial agglomeration in China ..................... 58 Abstract ................................................................................................................................ 58 2 / 346 1. Introduction ......................................................................................................................... 59 2. Literature review ................................................................................................................... 60 2. Indices of agglomeration ....................................................................................................... 62 3. Data Description .................................................................................................................. 63 3. Statistical Analysis ................................................................................................................. 65 4. The impact of ownership on agglomeration .......................................................................... 66 4.1 The impact of ownership type on agglomeration ............................................................. 67 4.2 Controls for omitted variables ......................................................................................... 69 4.4 The role of technology .................................................................................................... 72 5. Conclusions .......................................................................................................................... 74 Chapter 4. Patterns of industrial agglomeration: Evidence from Tianjin .................................... 76 Abstract ................................................................................................................................ 76 1. Introduction ......................................................................................................................... 77 2. Theoretical review ................................................................................................................. 81 3. Measures of agglomeration ................................................................................................... 83 4. Geographic distribution and industrial concentration in Tianjin ............................................ 84 4.1 Data Description ............................................................................................................. 88 4.2 The concentration of production .................................................................................... 92 4.3. Agglomeration at the industry level ................................................................................ 94 5. The dynamics of agglomeration .......................................................................................... 102 5.1 Geographic distribution of unmatched firms ................................................................. 102 5.2 Changes in the most agglomerated industries ................................................................ 103 6. The determinants of agglomeration ..................................................................................... 105 7. The role of technology ........................................................................................................ 107 8. Conclusion .......................................................................................................................... 108 Chapter 5 ................................................................................................................................ 110 The location of firms and the impact of typhoons on the performance of manufacturing firms in the coastal regions of China .................................................................................................... 110 1. Introduction ....................................................................................................................... 110 2. Typhoons in China ............................................................................................................. 114 3 / 346 3. Data Description ...............................................................................................................