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Place Dependence, Industrial Diversification, and Economic Performance of Chinese Cities

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  • Yibo Qiao
  • Yingcheng Li
  • Ron Boschma

Abstract

Place dependence is a widely recognized concept but has rarely been quantified in existing research. Employing the Wasserstein Distance algorithm from machine learning literature and China’s Annual Survey of Industrial Firms dataset, this paper introduces a novel method to measure the place dependence of industrial dynamics in Chinese cities, and explore its impact on urban economic performance. Our empirical findings confirm the presence of place dependence in Chinese cities, and show that cities diversifying into more related and complex industries tend to exhibit higher levels of place dependence. Moreover, place dependence appears to complement the effects of relatedness and complexity in enhancing urban economic performance. These findings offer important insights for regional industrial development and urban planning practices.

Suggested Citation

  • Yibo Qiao & Yingcheng Li & Ron Boschma, 2025. "Place Dependence, Industrial Diversification, and Economic Performance of Chinese Cities," Papers in Evolutionary Economic Geography (PEEG) 2531, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Oct 2025.
    • Handle: RePEc:egu:wpaper:2531
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    File URL: http://econ.geo.uu.nl/peeg/peeg2531.pdf
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    References listed on IDEAS

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