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

Arbeitspapier

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.

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• Language: Englisch

References and Relationships

• Bibliographic citation: Series: EERI Research Paper Series ; No. 38/2010

Classification and Topics

• Classification: Wirtschaft ; Industry Studies: Manufacturing: General ; Size and Spatial Distributions of Regional Economic Activity ; Real Estate Markets, Spatial Production Analysis, and Firm Location: General
• Subject: Urbanization economies ; Industrial diversity ; Jacobs externalities ; City size

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Fu, Shihe ; Hong, Junjie
• Event: Veröffentlichung
• (who): Economics and Econometrics Research Institute (EERI)
• (where): Brussels
• (when): 2010

Further information

• Handle: http://hdl.handle.net/10419/142599