Impact of industrial agglomeration on new-type urbanization: Evidence from Pearl River Delta urban agglomeration of China

Abstract

This paper examines whether industrial agglomeration can promote new-type urbanization in Pearl River Delta urban agglomeration of China. By building dynamic spatial Dubin model, our econometric results show that industrial agglomeration can significantly promote new-type urbanization in local area, and the spatial spillover effects of producer service industry and financial industry are significant. Compared with geographical proximity, the spatial spillover effects are more significant among cities with similar economic development degree. More specifically, the impact of producer service industry agglomeration on new-type urbanization is greater than that of foreign-funded industry and manufacturing industry. The impact of financial industry agglomeration on local new-type urbanization can only appear in a long period of time. Moreover, in case of coordinated industrial agglomeration in local and adjacent areas, the long-term effects of industry agglomeration on new-type urbanization are greater than the short-term effects. Overall, this paper offers a more comprehensive understanding the relationship between industrial agglomeration and new-type urbanization in China.