Information and communication technologies and geographic concentration of manufacturing industries: evidence from China

Using the 2004 China economic census database, this paper examines the impact of information and communication technologies (ICT) on the geographic concentration of manufacturing industries, controlling for other determinants of industrial agglomeration. Higher geographic concentration is found consistently in industries where ICT are more widely adopted, and the association is stronger at higher geographic levels. Furthermore, young firms that have adopted ICT, although they are more footloose, contribute to industrial agglomeration. High-tech industries with advanced ICT also tend to agglomerate. Contrary to the prevalent argument that ICT lead to more dispersion, our study suggests that ICT promote industrial agglomeration.Information and communication technologies; Geographic concentration; Agglomeration; China

Information and communication technologies and geographic concentration of manufacturing industries: Evidence from China

Using the 2004 China economic census database, this paper examines the impact of information and communication technologies (ICT) on the geographic concentration of manufacturing industries, controlling for other determinants of industrial agglomeration. Higher geographic concentration is found consistently in industries where ICT are more widely adopted, and the association is stronger at higher geographic levels. Furthermore, young firms that have adopted ICT, although they are more footloose, contribute to industrial agglomeration. High-tech industries with advanced ICT also tend to agglomerate. Contrary to the prevalent argument that ICT lead to more dispersion, our study suggests that ICT promote industrial agglomeration.Information and communication technologies; Geographic concentration; Agglomeration

Testing Urbanization Economies in Manufacturing Industries: Urban Diversity or Urban Size?

Whether urbanization economies stem from urban diversity or urban scale is not clear in the literature. This paper uses the 2004 China manufacturing census data and tests simultaneously the effects of urban size and industrial diversity on firm productivity, controlling for localization economies and human capital externalities. We find that productivity increases with city size—but at a diminishing rate, and the city size effect becomes negative for cities with population over two million. Firms also benefit from industrial diversity, and the strength of such benefit increases with city size but decreases with firm size. The characteristics of agglomeration economies in a transition economy are also discussed.Urbanization economies; Industrial diversity; Jacobs externalities; City size.

Testing urbanization economies in manufacturing industries: urban diversity or urban size?

Whether urbanization economies are caused by urban diversity or urban scale is not clear in regional and urban economics literature. Many empirical studies have used either city population size or urban industrial diversity to measure urbanization economies and have reached different conclusions. This paper argues that city size mainly captures the pure scale economies of urban public goods, and may generate net diseconomies when a city size is too large. Urban industrial diversity can also enhance firm productivity. Using the 2004 China manufacturing census data, we test simultaneously the effects of urban size and industrial diversity on firm productivity, controlling for localization economies and human capital externalities. We found that city size effect does exist, but too large a city size indicates net diseconomies. Firms also benefit from industrial diversity, and the strength of such benefit increases with city size but decreases with firm size. The overall results support Jacobs's idea that small firms benefit more from urban diversity.Urbanization economies; Industrial diversity; Jacobs externalities; City size

Exchange Rate Risk and Trade Mode Choice in the Processing Trade: Evidence from Chinese Data

This study investigates the impact of exchange rate fluctuations on trade mode choices among assembly firms. Using the Chinese Customs data from 2000 to 2006, we show that exchange rate pass-through (ERPT) depends on which entity is responsible for importing inputs. Relative to passively receiving inputs under pure assembly (PA) mode, foreign invested assembly firms mainly source inputs by themselves through import and assembly (IA) mode and enjoy lower ERPT by doing so. We then relate exchange rate fluctuations to processing mode choices and find that the share of import through PA increases with exchange rate volatilities. This effect is more pronounced for firms in liquidity constrained industries and is mitigated by better local financial development

Location determinants of foreign logistics firms in China: A discrete choice approach

Ph.DDOCTOR OF PHILOSOPH

Subnational institutions and open innovation: evidence from China

Purpose: The purpose of this paper is to examine how subnational institutions within a country explain the performance consequences of open innovation (OI) in emerging market enterprises (EMEs). Design/methodology/approach: The paper conducts a regression analysis by using a novel panel data set comprising of 438 innovative Chinese firms over the period of 2008-2011. Findings: The authors show that although on average openness to external actors improves innovation performance this effect is pronounced for EMEs that operate in subnational regions with a higher level of intellectual property rights (IPR) enforcement and of factor market development. The findings point to the context-dependent nature of OI strategy and the complementary effect of institutional parameters in emerging markets and help to reconcile the contrasting findings regarding the effect of OI in the prior literature. Originality/value: This paper extends the literature on OI by suggesting that the analysis of the performance consequences of OI strategy should go beyond the nexus between OI and firm performance, and instead, focus on subnational-specific institutions, such as region-specific IPR enforcement, factor market development and intermediation market development, that may facilitate or constrain the effect of OI model