Canfei He

Is Economic Transition Harmful to China’s Urban Environment? Evidence from Industrial Air Pollution in Chinese Cities

Economic transition has posed a serious challenge to environmental protection efforts in China. This study explores the environmental effects of the triple transition process of marketisation, globalisation and decentralisation using data on industrial SO2 and soot emissions at the prefecture-city level. Panel data regression results find that marketisation and decentralisation have been harmful to the urban environment while economic globalisation has been beneficial to urban air quality. As is to be expected, state-owned enterprises have contributed to China’s environmental degradation. However, the environmental impacts of the triple processes of economic transition only occur in the coastal and central cities. The results imply that the institutional perspective provides an important angle to understand the issue of environmental deterioration in China.

Fiscal decentralization, political centralization, and land urbanization in China

This study investigates the driving forces of land urbanization in China. Drawing upon insights from the institutional perspective, this study argues that fiscal decentralization tightens local budget constraints, stimulating local governments to urbanize land to relieve fiscal distress. Political centralization triggers interregional competition among government officials for better economic performance, inspiring local governments to employ land development to mobilize more capital investment for growth. Based on official land-use change data from 2002 to 2008 for prefectural cities, and the application of spatial econometric models, this study presents empirical evidence to support these theoretical arguments. Results imply that fiscal and political incentives derived from land development drive China’s land urbanization process. This study enriches the urbanization literature by providing an institutional understanding of rapid land urbanization in a transitional economy.

What matters for regional industrial dynamics in a transitional economy

ABSTRACT Recent evolutionary economic geography (EEG) studies have argued that regional diversification emerges as a path-dependent process, as a region often branches into related industries, whereas unrelated industries have a high probability of exiting the region. Based on a firm-level dataset of China’s manufacturing industries during 1998–2008, this paper examines the entry and exit of four-digit industries at the prefectural level, and shows that Chinese regional industrial development is a path-dependent process that is also affected by industry characteristics and the institutional framework. The results imply that EEG would profit from incorporating insights on institutional change and industry characteristics in explanations of regional industrial evolution.

The Principle of Relatedness

The idea that skills, technology, and knowledge, are spatially concentrated, has a long academic tradition. Yet, only recently this hypothesis has been empirically formalized and corroborated at multiple spatial scales, for different economic activities, and for a diversity of institutional regimes. The new synthesis is an empirical principle describing the probability that a region enters - or exits - an economic activity as a function of the number of related activities pre- sent in that location. In this paper we summarize some of the recent empirical evidence that has generalized the principle of relatedness to a fact describing the entry and exit of products, industries, occupations, and technologies, at the national, regional, and metropolitan scales. We conclude by describing some of the policy implications and future avenues of research implied by this robust empirical principle.

Firm Dynamics, Institutional Context, And Regional Inequality Of Productivity In China

Abstract This paper focuses on the issue of regional inequality in China. It seeks to move away from focusing on the relationship between factor accumulation and regional inequality towards an analytical framework that concentrates upon the ways in which regional inequality has articulated with factor productivity and firm dynamics, while acknowledging the role of institutional context. Based on one database on firm‐specific economic and financial variables, this paper measures factor productivity in Chinas manufacturing industry at the regional level, and decomposes it into various components. Empirical results confirm that regional inequality in terms of productivity have been declining in China. It also demonstrates that regional inequality has been fundamentally shaped by the regional institutional context, particularly in regard to the triple process of decentralization, globalization, and marketization, resulting in an enormous spatial variation of economic and institutional landscapes.

Industry relatedness and new firm survival in China: do regional institutions and firm heterogeneity matter?

Abstract Recent studies in evolutionary economic geography (EEG) highlight the key role of industry relatedness and cognitive proximity in boosting firm performance using data from developed countries. This paper explores the effect of industry relatedness on new firm survival in China by using a firm-level dataset for the 1999–2008 period. Based on survival models, it contributes to the ongoing debate by pointing out that new firms that are highly related to local industries have a lower failure rate, and the effect of industry relatedness is inflected by regional institutions and firm attributes. Industry relatedness occurs more effectively in the market-oriented regions but less effectively in regions with strong economic and political incentives of local governments.

Economic Globalization and Local Responses

This chapter traces the question of globalization and reviews the efforts from geographers to understand the spatiality of economic globalization. Specific efforts have been made to review four research areas, including transnational corporations, cross-border flows, consequence of global-local interactions and local response to economic globalization. This chapter also highlights the contributions of Chinese scholars in globalization studies. As the speed-up of China’s integration into the globalization process, Chinese scholars are capable of offering more insights into cross-border economic activities, regional integration and global governance. Roadmap for future research is therefore depicted to embrace this trend.

Local government intervention, firm–government connection, and industrial land expansion in China

ABSTRACT This study investigates the driving forces of industrial land expansion under China’s unique land use system in the context of economic transition with an explicit emphasis of the interactive relationship between local government and enterprises. Stemming from institutional insights in a transitional economy, this study develops a novel framework to integrate governmental intervention, firm–government connection, and economic transition to explain the spatial patterns and reveal the mechanisms of industrial land expansion in China. Based on the national utilization conveyance data and spatial econometrics, this study confirms that local government intervention and firm–government connection affect industrial land development significantly and in a spatially heterogeneous way. This study contributes an institutional and transitional knowledge to understand rapid industrial land expansion in China.