Impact of Industrial Agglomeration on China’s Residents’ Consumption

Suhua Zhang, Yasmin Bani, Aslam Izah Selamat and Judhiana Abdul Ghani
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Suhua Zhang: School of Business and Economics, Universiti Putra Malaysia, Kuala Lumpur 43400, Malaysia
Yasmin Bani: School of Business and Economics, Universiti Putra Malaysia, Kuala Lumpur 43400, Malaysia
Aslam Izah Selamat: School of Business and Economics, Universiti Putra Malaysia, Kuala Lumpur 43400, Malaysia
Judhiana Abdul Ghani: School of Business and Economics, Universiti Putra Malaysia, Kuala Lumpur 43400, Malaysia

Sustainability, 2022, vol. 14, issue 7, 1-18

Abstract: Residents’ consumption is a good indicator of people’s livelihoods and one of the motivations driving economic growth. There are many studies on the influencing factors of residents’ consumption; however, few have studied the effects of industrial agglomeration on residents’ consumption, and even fewer have studied the spatial correlation of residents’ consumption. The goal of this paper is to research the impact of China’s manufacturing industrial agglomeration on residents’ consumption from a spatial perspective. Using data on China’s 31 provinces from 2003 to 2019 and the spatial Durbin model, our results show that the manufacturing industrial agglomeration and residents’ consumption present an inverted “U-shape” relationship and that different regions show different effects. Industrial agglomeration in the eastern region is relatively high and has a restraining effect on residents’ consumption, while industrial agglomeration in the central and western regions is at an early stage and promotes residents’ consumption. Therefore, different regions should adopt different industrial agglomeration policies.

Keywords: manufacturing industrial agglomeration; residents’ consumption; regional studies; Moran’s I index; spatial panel Durbin model (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
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