Abstract
This paper uses a dynamic panel approach to investigate the impact of economic policy on industrial specialization and regional concentration of China’s high-tech industries for the period 1996–2005. It is found that the degrees of specialization and concentration show increasing trends throughout the sample period, while high-tech industry sector has increasingly concentrated in costal regions. It is also found that the implementation of high-technology-oriented export policy and subsidy for science and high-technology activities encourage specialization and concentration, whereas local governments’ protection for local high-tech enterprises results in convergence in regional industrial structure and obstructs regional concentration of high-tech industries. The estimation result is robust not only to the use of various estimation techniques, but also to the control for other factors proposed by theories such as transport costs and knowledge resources. Our findings support the idea that economic policies might play an important role in determining the geographic distribution of high-tech industries in China.
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Notes
Specialization and concentration reflects the characteristic of a region and an industry, respectively. See Aiginger and Davies (2004) for a thorough analysis on the differences and relations between the two terms.
The definition is compatible with OECD’s classification of high-technology industries, which take the share of R&D expenditure in manufacturing output or value added (i.e., R&D intensity) as criteria for classification.
Similar division has been used in Guo (1999) and Gao (2004). Northern Coast includes 5 provinces, which are Beijing, Tianjing, Hebei, Liaoninig and Shandong; Middle Coast includes 3 provinces, which are Shanghai, Jiangsu and Zhejiang; Southern Coast includes 4 provinces, which are Fujian, Guangdong, Guangxi and Hainan; Northern Inland includes 5 provinces, which are Shanxi, Inner Mongolia, Jilin, Heilongjiang and Shanxi; Middle Inland includes 5 provinces, which are Anhui, Henan, Hubei, Jiangxi and Hunan; Southern Inland includes 4 provinces, which are Chongqing, Sichuan, Guizhou and Yunnan; Far West Inland includes 4 provinces, which are Gansu, Qinghai, Ningxia and Xinjiang. Tibet is not included due to the incomplete data collection.
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Acknowledgments
Zheng acknowledges financial support from China Scholarship Council (CSC) via a scholarship under the State Scholarship Fund. Kuroda appreciates the financial support by JSPS: Grant-in-Aid for Scientific Research (B) 19330048. We thank Asao Ando, Domingo P. Ximénez-de-Embún, participants to the 24th Applied Regional Science Conference (Nagoya), the 51th European Regional Science Conference (Barcelona), and an anonymous referee for their helpful comments on an earlier version of this paper.
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Appendix
Appendix
To investigate the stationary properties of each time series, we first perform two standard unit root tests and report the results in Table 9. The result indicates that for all lagged variables, the unit root tests reject the null hypothesis that series has a unit root. Table 10 reports the estimation results of the simple AR(1) specifications for each time series. It is found that all series but local profit ratio has a positive and significant coefficient higher than 0.900, which provides strong evidence supporting the high persistence of each series.
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Zheng, D., Kuroda, T. The impact of economic policy on industrial specialization and regional concentration of China’s high-tech industries. Ann Reg Sci 50, 771–790 (2013). https://doi.org/10.1007/s00168-012-0522-4
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DOI: https://doi.org/10.1007/s00168-012-0522-4