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Comparative Advantage, Scale Economy and Regional Specialization：An Empirical Analysis Based on China’s Industries

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  • Lu, Zheng
  • Deng, Xiang

Abstract

Current empirical studies on regional specialization mainly focused on measurement of China’s overall regional specialization level, while determinants of industrial geographical distribution, namely the regional specialization pattern, are just paid few attentions. This paper analyzed the regional specialization pattern empirically by employing statistical data of China two-digit industries from 1987 to 2007 through estimating a model which takes comparative advantage and scale economy as driven factors of industrial geographical concentration. Conclusions show that the overall regional specialization of Chinese industries increased between 1987 and 2007, however, it decreased obviously in 1990s. And, scale economy rather than comparative advantage arising from production cost is a long-run factor of China’s industrial geographical distribution.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 39312.

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Date of creation: 20 May 2012
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Handle: RePEc:pra:mprapa:39312

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Keywords: Comparative Advantage Scale Economy Regional Specialization China;

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  1. Elisenda Paluzie Hernandez & Jordi Pons Novell & Daniel Aurelio Tirado Fabregat, 2000. "Regional integration and specialisation patterns in Spain," Working Papers in Economics 62, Universitat de Barcelona. Espai de Recerca en Economia.
  2. Mary Amiti, 1997. "Specialisation Patterns in Europe," CEP Discussion Papers dp0363, Centre for Economic Performance, LSE.
  3. Lu, Zheng & Flegg, A.Tony & Deng, Xiang, 2011. "Regional specialization: a measure method and the trends in China," MPRA Paper 33867, University Library of Munich, Germany.
  4. Ellison, Glenn & Glaeser, Edward L, 1997. "Geographic Concentration in U.S. Manufacturing Industries: A Dartboard Approach," Journal of Political Economy, University of Chicago Press, vol. 105(5), pages 889-927, October.
  5. Poncet, Sandra, 2003. "Measuring Chinese domestic and international integration," China Economic Review, Elsevier, vol. 14(1), pages 1-21.
  6. Colin A. Carter & Bryan Lohmar, 2002. "Regional Specialization of China's Agricultural Production," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(3), pages 749-753.
  7. Haaland, Jan I. & Kind, Hans Jarle & Ulltveit-Moe, Karen-Helene, 1999. "What Determines the Economic Geography of Europe?," CEPR Discussion Papers 2072, C.E.P.R. Discussion Papers.
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