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Economic Agglomeration Should Not Be Blamed for Widening Income Gaps in China
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Economic Agglomeration Should Not Be Blamed for Widening Income Gaps in China
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Journal Article
Economic Agglomeration Should Not Be Blamed for Widening Income Gaps in China
2012
Overview
Agglomeration of economic activities is a common phenomenon across the world. Theoretical and empirical studies have shown that agglomeration promotes dynamic efficiency, which in turn is conducive to the long-term prosperity of a country＇s economy. Compared with most countries, in China is very low, and Chinese cities the spatial concentration of various industries are relatively small and equal-sized. Thus, it is unnecessary to contain the agglomeration of economic activities in China. Widening regional gaps since pro-market reforms and opening-up in China should be ascribed to institutional barriers rather than agglomeration. Therefore, China should refrain from containing agglomeration and instead focus on integrating product and factor markets and improving education and health care in less developed areas.
