Dynamic Externalities and Manufacturing Productivity: An empirical comparison among China's top three municipalities

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Dynamic Externalities and Manufacturing Productivity: An empirical comparison among China's top three municipalities

[RIETI Discussion Paper Series 12-E-072]
(November 2012)

Abstract
By reviewing and improving previous empirical works on this topic, the present paper investigates the dynamic externalities of agglomeration in China. Taking China’s top three municipalities (i.e., Beijing, Shanghai, and Tianjin) as sample regions, it assesses empirically and compares how three types of dynamic externalities—namely MAR (Marshall–Arrow–Romer), Jacobs, and Porter externalities—affect manufacturing productivity. The main findings of this paper are threefold. First, all three types of dynamic externalities measured in labor productivity can be found in the three sample regions, but large differences in the degrees and directions of the effects exist among them. Second, the degree and sign of the effects of each type of externality vary with changes in time lags. Third, the positive effects of these externalities seem to be substitutable for one another. Specifically, if MAR externalities contribute more to productivity growth in one city, Jacobs or Porter externalities do so to a lesser degree and vice versa.



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학술보고서 : Foreign Manufacturing Multinationals and the Transformation of the Chinese Economy

※ 첨부파일 참조

2012.12.13

대외경제정책연구원

12e072.pdf