Industrial Agglomeration and Comprehensive Carrying Capacity of Urban Areas: Evidence from Manufacturing and Services Industry in Beijing-Tianjin-Hebei Urban Agglomeration

Abstract

Industrial agglomeration in China has been increasingly enhanced over the recent 40 years. Does the agglomeration bring more burden on urban carrying capacity (UCC), or is it of great benefit to a better UCC? The answer of this question is of great importance to China’s sustainable urban development and economic growth. To study the 13 cities in Beijing-Tianjin-Hebei urban agglomeration (BTHUA) from 2006 to 2016, this paper uses a spatial econometrics model to analyze the impact of manufacturing industrial agglomeration (MIA) and services industrial agglomeration (MIA), respectively, on the UCC. The results present some novel findings. First, the spatial autocorrelation tests show that there are significant spatial autocorrelations in the UCC, MIA and SIA. Second, the impact of MIA on the UCC has inverted “U”-type characteristics. The over-MIA of the urban agglomeration weakens the UCC. Third, SIA has positive impact on the UCC. More concentrated services industry means a better carrying capacity of urban areas. Finally, this paper puts forward some suggestions for policy makers to optimize the industrial structure and enhance the UCC for sustainable urban development and economic growth.

Keywords: Industrial agglomeration; Urban carrying capacity; Manufacturing; Services; Spatial econometrics model

JEL Classification: R11