FDI facilitated by agglomeration economies: evidence from manufacturing and services joint ventures in China

The open door policy of China’s economic reform since the 1980s has attracted heavy foreign direct investment (FDI) flows into China and especially to Guangdong (particularly the Pearl River Delta region, PRD) and induced significant economic growth during the past two decades. While there exist various classical theories of FDI in attempting to identify the determinants of FDI inflow and to explain the behavior of FDI flows, limited attention has been given from the perspective of agglomeration effects generated by a core-periphery (CP) relation.This paper intends to study the impacts of agglomerations on FDI inflows in the context of Krugman’s CP relation (1991) by investigating (1) the formation of a CP relation via gravity model analysis; (2) whether different types of industry FDI flows will respond differently in the CP-system, given agglomeration effects; and (3) whether FDI origin and firm scale matter in affecting FDI flows.A database consisting of a population frame of 37,742 firm-level manufacturing and services joint ventures investing in Guangdong in 1998 was used. Empirical results show that the agglomerations of the CP relation have affected FDI flow patterns. While both manufacturing and services FDI and sources of investment responded differently to the impacts, smaller firms were found more responsive to the CP-agglomeration settings regardless of FDI by industry type and by source. The significance and implications of the CP-system to further facilitate FDI in the region are discussed.     

核心-边缘理论在区域旅游规划中的运用

核心－边缘理论为区域旅游规划提供了建构区域旅游空间结构系统的认知模型。运用这种空间结构模型，在进行旅游资源的区域整合，景区土地利用功能配置与都会城市旅游圈层构造，以及促进区域旅游联动发展方面可取得满意的实践成果，核心与边缘地区应该是一种平等竞争，优势互补，合作互嬴的空间关系，发展核心，带动边缘，是区域旅游发展的重要战略兴措，发展中地区要注意培育旅游核心区，形成旅游创新活动基地，带动边缘区域发展，壮在整个区域的旅游竞争力。     

Understanding consumption in social virtual worlds: A sensemaking perspective on the consumption of virtual goods

Virtual consumption involves consuming virtual goods in cyberspace. Virtual consumption activities are evolving into an essential activity in social virtual worlds. Despite the growing importance of this activity, little research examines this phenomenon. The current study investigates the fundamental question of how users understand the consumption of virtual goods. Using the theory of social representations and core-periphery analysis, this study elicits and analyzes the social representation of virtual consumption. Study participants are 154 Second Life users. Results identify 32 concepts and relationships representing the collective perceptions of virtual consumption in this social virtual world. Social representation map interpretations point to several key themes that provide a foundation for future investigations of virtual economy consumption behavior.     

Place,space, and foreign direct investment into peripheral cities

Perspectives drawn from the economic geography literature are increasingly used to generate insights into locational issues in international business. In this paper, we seek to integrate these literatures further by investigating the locational determinants of foreign direct investment (FDI) into peripheral cities within an emerging economy. Peripheral cities in emerging economies are attracting a growing proportion of global FDI flows, but the international business literature lacks a framework for understanding subnational determinants of FDI, particularly into non-core locations. We draw on the core-periphery model to build and test theory on how spatial interdependencies between subnational locations impact on the distribution of FDI inflows into a large and heterogeneous country China. Our results show that whilst peripheral cities tend to have a negative effect on FDI, this effect is positively moderated by proximity to core cities. The results highlight the importance of considering interactions between place and space when investigating locational issues in international business.     

Liberalization and changing spatial configurations in Nigeria’s domestic air transport network

In realization of the increasingly important role played by air transport, the Nigerian government followed the global trend of deregulation in reforming its domestic airline industry in 1985. Some of the effects of deregulation have been consistent with observed trends in other countries but others have been quite different. The abandonment of less profitable routes in the short term as well as the unfolding core-periphery structures following the emergence and dominance of certain core control centers replicates what obtained in the United States. However, evidence from literature suggesting that liberalization in practice has often resulted in the rising concentration of connectivity in a limited number of nodes and links rather than in its dispersal over the network at large does not hold yet in Nigeria’s domestic air network. This paper shows that the shifting balance between concentration and dispersal in Nigeria’s domestic network is generally skewed towards dispersal. Passenger traffic is more dispersed among nodes as gleaned from diminishing standard deviation values with increasing number of nodes. Generally speaking, overall connectivity also tends towards more evenness in the network since deregulation.     

The turn in recent economics and return of orthodoxy

This paper examines change on the economics research frontier,and asks whether the current competition between new researchprogrammes may be supplanted by a new single dominant approachin the future. The paper discusses whether economics tends tobe dominated by a single approach or reflect a pluralism ofapproaches, and argues that, historically, it has alternatedbetween the two. It argues that orthodoxy usually emerges fromheterodoxy, and interprets the division between orthodoxy andheterodoxy in terms of a core–periphery distinction. Regardingrecent economics, the paper maps out two different types ofcombinations of new research programmes as being synchronicor diachronic in nature. It treats the new research programmesas a new kind of heterodoxy, and asks how a new orthodoxy mightarise out of this new heterodoxy and traditional heterodoxy.It discusses this question by advancing two views regardinghow to different types of combinations in the new research programmesmight consolidate along the lines of three shared commitmentswith traditional heterodoxy to form a new orthodoxy in economics.     

Discrete Dynamics for the Core-periphery Model

Abstract

It is known that the discretisation of continuous-time models can introduce chaotic behaviour, even when this is not consistent with observations or even the model's assumptions. We propose generic dynamics describing discrete-time core-periphery models that comply with the established assumptions in the literature and are consistent with observed behaviour. The desired properties of the dynamics are proved analytically in the general case. We also give particular forms for the dynamics for those interested in applying our model.     

The core-periphery model: A note on the existence and uniqueness of short-run equilibrium

We consider the core-periphery model [P. Krugman, Increasing returns and economic geography, Journal of Political Economy 199 (1) (1991) 483–499]. The nature and stability of the possible steady states of the model have been made progressively precise; [M. Fujita, P. Krugman, A. Venables, The Spatial Economy. Cities, Regions and International Trade, MIT Press, Cambridge, 1999; R. Baldwin, R. Forslid, Ph. Martin, G. Ottaviano, F. Robert-Nicoud, Economic Geography and Public Policy, Princeton Univ. Press, 2003]. In that model as well as in all the new economic geography models that have been derived from it, the short-run (instantaneous) equilibrium is implicitly determined by the current labor distribution across regions. The numerical computations used so far to determine the short-run equilibrium, tend to suggest its existence. In this paper, an existence and uniqueness proof of short-run equilibrium is provided.     

Economic geography with tariff competition

A simple two-country model of economic geography is constructed in order to examine the effect of tariff competition on the spatial distribution of manufacturing activities as well as on welfare. We show that when the transport cost is small, tariff competition with firm migration leads to a core-periphery economy, where one of the two countries imposes no tariff in Nash equilibrium. We also show that when the transport cost is sufficiently large, both countries impose a positive tariff, which decreases the welfare of both countries.     

The core periphery model with asymmetric inter-regional and intra-regional trade costs

We generalize the model of Krugman (J Polit Econ 99(3):483–499, 1991) to allow for asymmetric trade costs between regions and for (asymmetric) trade costs that are internal to the regions. We find that industrial activity, in a region, is enhanced by higher costs of importing and lower costs of exporting (more precisely, by a higher ratio between the two trade costs). This suggests that countries may impose tariffs on imported goods and seek to remove the import tariffs in other countries (unilateral protectionism) in order to foster industrial activity. Industrial activity is also promoted by lower domestic internal trade costs and higher foreign internal trade costs (more precisely, by a lower ratio between the two trade costs).