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Entrepreneurship and Industrial Clusters: Evidence from China Industrial Census

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  • Zhu, Xiwei

    () (School of Economics, Zhejiang University)

  • Liu, Ye

    () (School of Economics, Zhejiang University)

  • He, Ming

    () (Division of Economics, Xi'an Jiaotong-Liverpool University)

  • Luo, Deming

    () (School of Economics, Zhejiang University)

  • Wu, Yiyun

    (School of Economics, Zhejiang University)

Abstract

This article studies the synergy effect of entrepreneurship on China’s industrial clusters. We propose an extension to Duranton and Overman’s (2005) method which enables us to delimit industrial clusters in space. The empirical model is identified with historical measures of local entrepreneur potential in the spirit of Chinitz (1961). We find that measures of entrepreneurship contribute significantly to cluster formation, cluster size, and cluster strength. Access to sea ports stimulates industrial concentration but agricultural legacy has the opposite effect. Light industries have more clusters which are also larger and stronger. Clusters also benefit from historical measures of market potential, localization/urbanization economies, and urban population density. Most of the results are robust to alternative instrumental strategies. Finally, we find evidence that the synergy effect is stronger where the local conditions are favorable to clusters.

Suggested Citation

  • Zhu, Xiwei & Liu, Ye & He, Ming & Luo, Deming & Wu, Yiyun, 2017. "Entrepreneurship and Industrial Clusters: Evidence from China Industrial Census," RIEI Working Papers 2017-05, Xi'an Jiaotong-Liverpool University, Research Institute for Economic Integration.
  • Handle: RePEc:xjt:rieiwp:2017-05
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    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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