Technology parks and regional economic growth in China

Abstract

China's technology parks have been growing rapidly in the decade that followed their establishment. I examine whether this is merely in response to the policy incentives or there have been external economies from the concentration of high-technology firms in the technology parks as policy makers had hoped. Using data on China's 53 national technology parks from 1992 to 2000 and data on the metropolises that host them, I find results that are consistent with the neoclassical growth mechanism-labor productivity across technology parks is converging and there is no evidence of geographical external economies. But the foreign direct investment the host city receives has robustly contributed to the productivity growth in the technology parks. Finally, I find evidence that in their early stage of development the technology parks have hampered the secular trend of increasing regional inequality in China.©2006 Elsevier B.V. All rights reserved.