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non-treated units in the analysis and to con- 3 years.20 Summary statistics for the relevant
sider increasing treatment intensity across variables are in Supplementary Table A1.
time. Our outcome variables are industrial To analyse the association between STs
and agricultural output in county i at time t and territorial rebalancing (RQ2), we divide
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intermediate doses. These results suggest a posi- suggest that the relation with industrial output
tive and significant relation between STs and is flat and non-significant up to 60% of the dose
output, when STs are sufficiently numerous (about five towns), and then it significantly in-
(50–60% of the dose, corresponding to about 20 creases.This relation becomes U-shaped including
towns). the total number of STs as a control (Figure 6(b)):
Figure 6 reports the dose-response related to for small amounts of endogenous STs, the rela-
endogenous towns. The first results (Figure 6(a)) tion is decreasing—and negative—becoming then
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1-year lag effect on Industrial output 3-year lag effect on Industrial output
Figure 5. Dose-response function of number of STs on industrial and agricultural output.
positive and increasing. For agricultural output local policymakers and scholars about spe-
(in both cases), the relation between endogenous cific STs cases. Specifically, PRD’s STs have
towns and output is positive and increasing, par- followed two different paths. One is based on
ticularly for doses’ amounts above 60% (again, FDI and exports that generated some of the
five towns). most important national production and ex-
Our interpretation of the results comes from port hubs. An example is Dongguan, whose
the combination of the panel fixed-effects es- specialisation has been mainly linked to FDI-
timations and the dose-response models. First, led ICT production (Wang and Lin, 2008;
we observe significant and positive results Zhou et al., 2011; our interviews). The second
in both models only for endogenous towns. development pattern, conversely, has been
Particularly, for industrial output, these re- more based on local firms and traditional
sults are relevant for PRD counties (Table 2) products for internal demand. This is the
and for large numbers of endogenous towns case, for example, of Foshan, whose indus-
(Figure 6). The results concerning the PRD trialisation was based more on local forces
can be read in the light of its economic de- than foreign capital but becoming, however,
velopment history (Di Tommaso et al., 2013; a core Guangdong’s manufacturing centre
OECD, 2010; Zeng, 2010). They are further (Di Tommaso et al., 2013; NBS, 2010; Zeng,
reinforced by the fieldwork interviews to 2010; our interviews). The positive relation
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Figure 6. Dose-response function of number of endogenous towns on industrial and agricultural output.
between endogenous towns and industrial marginal, non-PRD areas, engaged in agriculture-
output seems to reflect the performance of related and resource-based productions.
this second group of clusters.
We also find positive association between The effects of specialised towns and
industrial output and large numbers of en- endogenous specialised towns on
dogenous townships. Excluding Foshan, all territorial rebalancing (RQ2)
the counties hosting numerous endogenous
Table 3 reports the subgroup analysis results.
townships are in few non-PRD peripheral
The only persistent positive association is re-
counties. This would suggest that, for high lated to t-1 and t-3 RATIO_ENDOG for areas
numbers of endogenous clusters, positive ef- with initial medium-low levels of output (all out-
fects could be observed also in remote areas. side the PRD). Coupled with previous evidence
The evidence related to agricultural output, of the dose-response, this result reinforces that,
consistent across the models, shows a possible also for some non-PRD areas, large amounts
positive effect of endogenous towns. This is of endogenous towns might promote industrial
linked with the pattern of specialisation of more development. Therefore, although PRD may
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Figure 6. Continued
particularly benefit from the establishment of en- 1. The evolution of Guangdong clusters
dogenous towns, under some circumstances, such calls for attention on the relationship
types of clusters might be desirable also for mar- between policies’ objectives and tools
ginal areas in a territorial rebalancing perspective. rather than only on the tools. Indeed,
we have highlighted how the same tool,
that is, specialised clustering promotion,
Final remarks was used for accommodating different
Guangdong ST programme is perhaps one evolving goals (for example, from mere
of the largest-scaled experiments of policy- industrialisation to territorial rebalan-
supported territorial industrial transformation cing). The ST experience reinforces the
worldwide. It has contributed to the province’s statement made in a number of academic
widespread industrial growth, shaping its geog- contributions: industrial policy should no
raphy of production and placing some of its longer be viewed as a mere discussion on
towns at the centre of global production chains. the best tools to achieve well-established
We believe this experience draws some useful aims. Conversely, it is a complex process
lessons for the international debate about in- entailing considerations on a society’s
dustrial policy. long-term broad aims (Andreoni and
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Table 3. Effects of specialisation and endogenous clusters on rebalancing (Dependent Variable – ln_INDOUT).
Chang, 2016; Andreoni and Scazzieri, 3. Concerning clustering policies, our evidence
2014; Chang, 1994; Cimoli et al., 2009; Di suggests that using different types and com-
Tommaso and Schweitzer, 2013). In this binations of specialisation and localisation
view, industrial policy is not just a set of can produce different results, corresponding
instruments to achieve fixed purposes. It to different policy aims. Additionally, STs
should be rather conceived as a process experience confirms that, as for mature
that drives structural economic and social economies (Bailey et al., 2015), also for
change. developing countries, an approach to sec-
2. China’s ability to implement industrial
toral specialisation and upgrading tailored to
policies is founded on a well-defined in- local contexts might improve local economic
stitutional architecture, with agencies and performances better than exogenous-driven
personnel, whose functioning has been growth. It appears to us that policymakers
changing, dedicated to design, experiment might have followed this path, passing from
and apply policies. In particular, career in- a place-neutral attitude in the beginning to a
centives have been lately aligned with new more place-based perspective later.
long-term industrial policy goals, shifting
from mere economic growth to social and Finally, the STs programme is not free from
environmental issues.21 This would suggest important limitations, which also draw general
that revitalised industrial policies must in- policy implications and set the line for future
clude investments in government capacity research. Indeed, environmental and social
building. sustainability issues have become increasingly
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Industrial policy in China
serious in Guangdong, also given its fast in- in developing areas, such as the garment cluster in
dustrialisation. These aspects have recently Nairobi (Van Dijk and Rabellotti, 2005) or the knife
generated growing concerns and some first cluster in Pakistan (Nadvi, 1999).
policymaking reactions. Accordingly, it seems 8
The debate is wide and cannot be treated here.
emerging countries, an aspect that has been main institutions that we visited.
neglected so far. For each yuan granted from the province, a city
11
5
http://www.hktdc.com/web/featured_suppliers/ that acknowledge the difficulties in making proper
dongguan/index.html. policy evaluation of clustering initiatives (Brakman
6
Even if there are other areas in China character- and van Marrewijk, 2013; Vicente, 2018).
ised by the presence of industrial clusters (such as 15
We use the fixed-effects version of the model.
Zhejiang Province), these are not the target of a spe- Compared to its ordinary least squares (OLS) ver-
cific policy programme. sion (Filippetti and Cerulli, 2018), the results are
7
The industrial clusters category includes very het- equivalent to that obtained by adding individual
erogeneous realities, ranging from agglomerations of fixed effects to a pooled OLS estimation.
high-tech companies in advanced countries (such as The main variable on which we analyse the possible
16
Sophie-Antipolis in France, the Cambridge region in effects of agglomerations is industrial output. With ref-
the UK or the Silicon Valley in the USA) to groups erence to the first part of the empirical analysis, how-
of SMEs specialised in traditional sectors located ever, we also observe the effects on agricultural output
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for two reasons: first, one-fourth of the specialised on the Agenda? Industrial Policy revisited confer-
towns specialise in agricultural products; second, many ences (Bath, 26 April 2018 and Cambridge, 12–13
of the inner or peripheral areas count on its agricultural July 2018) for the insightful comments and sugges-
sector for a large part of their total output. tions on the paper. We would also like to thank Paolo
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