Geographical Concentration of Manufactur ing Industries in China

  • Department of Urban and Regional Planning, Peking University, Beijing 100871, China

Received date: 2007-04-09

  Revised date: 2007-08-27

  Online published: 2007-12-25

Supported by

National Natural Science Foundation of China, No.40401015; No.40535027


This paper examines the micro foundations of geographical concentration of Chinese manufacturing industries in China at very disaggregated levels using the most recent economic census data. The empirical results indicate that natural advantages, agglomeration economies and institutional changes together influence industrial location in China. Overall, industries bearing higher transportation costs and difficulty to ship are largely dispersed. Resource-based industries follow the pattern of natural advantages and show less agglomeration but metal mineral consuming industries are agglomerated. Trading establishments and foreign enterprises are heavily concentrated, confirming the importance of globalization effects. However, local protectionism has indeed discouraged industrial agglomeration, but provincial governments are more likely to succeed in exercising local protectionism policies and imitation strategy compared to the county governments. Agglomeration economies have done a better job in driving the geographical concentration of Chinese industries at the county level than at the province level. Proxies for knowledge spillovers are highly significant at the county level. The findings suggest that the spatial scale matters in understanding industrial clustering, and economic transition and its consequence are also critical in explaining the spatial pattern of Chinese industries.

Cite this article

HE Canfei, PAN Fenghua, SUN Lei . Geographical Concentration of Manufactur ing Industries in China[J]. Acta Geographica Sinica, 2007 , 62(12) : 1253 -1264 . DOI: 10.11821/xb200712002


[1] Wang Jici et al. Innovative Space: Industrial Cluster and Regional Development. Beijing: Peking University Press, 2001.
[王缉慈等. 创新空间: 企业集群与区域发展. 北京: 北京大学出版社, 2001.]

[2] Ellison G, Glaeser E. Geographic concentration in U.S. manufacturing industries: A dartboard approach. Journal of Political Economy, 1997, 105: 889-927.

[3] Young A. The razor's edge: Distortions and incremental reform in the People's Republic of China. Quarterly Journal of Economics, 2000, 115: 1091-1135.

[4] Poncet S. A fragmented China: Measure and determinants of Chinese domestic market disintegration. Review of International Economics, 2005, 13: 409-430.

[5] Brulhart M. Economic geography, industry location and trade. World Economy, 1998, 21: 775-801.

[6] Kim S. Expansion of markets and the geographic distribution of economic activities: The trends in U.S. regional manufacturing structure, 1860-1987. Quarterly Journal of Economics, 1995, 110: 881-908.

[7] Ellison G, Glaeser E L. The geographic concentration of industry: Does natural advantage explain agglomeration? AEA Papers and Proceedings, 1999, 89: 311-316.

[8] Krugman P. Scale economies, product differentiation, and the pattern of trade. American Economic Review, 1980, 70: 950-959.

[9] Holmes T, Stevens J. Geographic concentration and establishment scale. Review of Economics and Statistics, 2002, 84: 682-690.

[10] Krugman P. Increasing returns and economic geography. Journal of Political Economy, 1991, 99: 483-499.

[11] Venables A. Equilibrium locations of vertically linked industries. International Economic Review, 1996, 37: 341-359.

[12] Amiti M. Trade liberalization and the location of manufacturing firms. World Economy, 1998, 21: 953-62.

[13] Krugman P, Elizondo L. Trade policy and the third world metropolis. Journal of Development Economics, 1996, 49: 137-50.

[14] Marshall A. Principles of Economics. London: MacMillan, 1890.

[15] Duranton G, Puga D. Micro-foundations of Urban Agglomeration Economies. Working Paper 9931, NBER, Cambridge,MA, 2003.

[16] Audretsch D, Feldman M. R&D spillovers and the geography of innovation and production. American Economic Review, 1996, 86: 630-640.

[17] Zhao X, Zhang L. Decentralization reforms and regionalism in China: A review. International Regional Science Review, 1999, 22: 251-281.

[18] Thun E. Keeping up with the Jones: Decentralization, policy imitation and industrial development in China. World Development, 2004, 32: 1289-1308.

[19] Research Group of the "Building up a Uniform National Market in China" in Development Research Center of the State Council. The report of the local protection in China: A preliminary analysis based on the sampling without firms. Review of Economic Research, 2004, 18: 31-38.
[国务院发展研究中心“中国统一市场建设”课题组. 中国国内地 方保护的调查报告: 非企业抽样调查结果初步分析. 经济研究参考, 2004, (18): 31-38.]

[20] Fan C, Scott A. Industrial agglomeration and development: A survey of spatial economic issues in East Asia and a statistical analysis of Chinese regions. Economic Geography, 2003, 79: 295-319.

[21] Bai Chong'en, Du Yingjuan, Tao Zhigang et al. Local protectionism and industrial concentration in China: Overall trend and important factors. Economic Research Journal, 2004, (4): 29-40.
[白重恩等. 地方保护主义及产业地区集中度决 定因素和变动趋势. 经济研究, 2004, (4): 29-40.]

[22] Wen Mei. Relocation and agglomeration of Chinese industry. Economic Research Journal, 2004, (2): 84-94.
[文枚. 中 国工业在区域上的重新定位和聚集. 经济研究, 2004, (2): 84-94.]

[23] He Canfei, Xie Xiuzhen. Geographical concentration and provincial specialization of Chinese manufacturing industries. Acta Geographica Sinica, 2006, 61: 212-222.
[贺灿飞, 谢秀珍. 中国制造业地理集中与省区专业化. 地理学报, 2006, 61(2), 212-222.]

[24] Luo Yong, Cao Lili. A positive research on fluctuation trend of China's manufacturing industrial agglomeration degree. Economic Research Journal, 2005, (8): 106-127.
[罗勇, 曹丽莉. 中国制造业集聚程度变动趋势实证研究. 经济研究, 2005, (8): 106-127.]

[25] Lu Jiangyong, Tao Zhigang. Industrial agglomeration and co-agglomeration in China's manufacturing industries: With international comparison. Economic Research Journal, 2006, (3): 103-114.
[路江涌, 陶志刚. 中国制造业区域聚集及 国际比较. 经济研究, 2006, (3): 103-114.]

[26] Feldman M. The new economics of innovation, spillovers and agglomeration: A review of empirical studies. Economics of Innovation & New Technology, 1999, 8: 5-25.

[27] Porter M. Location, competition and economic development: Local clusters in a global economy. Economic Development Quarterly, 2000, 14: 15-34.