Firms’ Location Choice And Spatial Agglomeration

Spatial agglomeration is a major field for the study of location theory, regionaleconomics, urban economics, economic geography, new economic geography andother subjects. In this field, each subject has its own focus of attention due to theirdifferent perspectives. Studied thoroughly, the issues being discussed can beclassified into three categories: first, reasons for agglomeration and the influencingfactors, second, research for the formation mechanism of agglomeration; third,location for agglomeration, i.e.“where to agglomerate”. Up till now, as for the formertwo issues, we have made great progress. But for the third one, only the historicityand contingency can account for.However, the fact that cities sprawl along rivers and coasts and people gatheraround lakes indicates there must be deeper reasons for the issue “where toagglomerate” besides historicity and contingency. To study the formation mechanismof spatial agglomeration by combing enterprise location selection and game analysisis not only an exploration for “deeper reasons”, but also an extension and deepeningfor classical location theories. At the same time, to study the formation mechanism ofspatial agglomeration from the view of enterprise location selection can also providea new idea for contributing to the formation of enterprise agglomeration and industryagglomeration.Chapter one consists of three parts, first two of which mainly illuminate therelevant background, research significance and the basic research methods, while partthree concentrates on its innovative points which contains two “attempts”, one ofwhich is to deduce the formation mechanism of spatial agglomeration by combinglocation selection and game analysis, the other is to solve the issue “where toagglomeration”.Chapter two is literature review. The study of spatial agglomeration came intothe field of economics for a very long time and it has achieved abundant researchresults. Thus, the references are of large quantity and wild range. This paper develops in a way as the following: reasons for agglomeration, factors influencingagglomeration and formation mechanism of agglomeration. That is, to elaborate thereasons for agglomeration through obtaining the advantages of resource endowment,externality, shared infrastructure, economics of scale, competitive strengths andlowing trade cost, to expound the factors influencing spatial agglomeration from thepoint of view of natural resources, shared intermediate input and labor force,knowledge spillover, economics of scale, local market effect and multifactor, etc, tocaption the formation mechanism of spatial agglomeration through classical locationtheory, spatial competition theory, regional science, new classical economics, neweconomic geography, etc. On the basis of the above, the last part of Chapter tworecapitulates the present references from three aspects, the location of agglomeration,spatial attribute and the main body of location and research methods.Focused on the issues in Chapter two, Chapter three aims at propose a newanalytical premise and thought of framework. Firstly, it analyzes the location and theessential characteristics of location. Secondly, it discusses in depth the basic meaningof location and location selection, main boy of location, the space attribute, factorsinfluencing location selection, etc. Thirdly, it elaborates the difficulties inhomogeneous space analysis and the relationship between location and its main body.At last, based on the above study, it attempts to deduce the formation mechanism ofspatial agglomeration under the integration of homogeneous space and heterogeneousspace and under the analytical framework of location selection and game theory.Under the analytical framework and thoughts of Chapter three, Chapter four andfive will discuss in depth how the two enterprises influencing each other select theirlocations under different conditions, whether the spatial agglomeration can berealized through location selection, and its realization probability. This discussion isunder the framework of static game of complete information, dynamic game ofcomplete information, static game of incomplete information and dynamic game ofincomplete information respectively. At last, at the last part of correspondinganalytical framework are the influences of business profits caused by differentdecision and the location factor, agglomeration factor of different location on theagglomeration conditions. All the above belongs to theoretical research, the conclusion of which is just atheoretical conjecture. We need to prove its trueness by using actual empirical data.So, in the analysis of Chapter six, we take two examples, Tianjin EconomicTechnological Development Area, east section (main section) and Yixian IndustryPark. First, analyze the enterprise locations, the development of enterprises in the twoareas and its own development, then on the basis of the questionnaire data, use factoranalysis to extract and analyze the essential factors influencing enterprise locationselection and the vital parts constituting agglomeration factors. At last, we reach aconclusion that improving the extracted factors mentioned above can influenceenterprise location selection, and then influence the probability of agglomeration.In addition, Factors extracted from questionnaire are consistent with theindispensable game factors drawn from game of incomplete information. The formerfactors include the closeness to competitors, distance from competitors and costs ofcompetitors while the latter include intention to agglomerate and the signal, etc.Therefore, the two examples, Tianjin Economic Technological Development Area,East section and Yixian Industry Park, can well justify the conclusion drawn from thetheoretical analysis.Chapter seven is the conclusion chapter. It mainly expounds two parts, one ofwhich is to come up with the countermeasures which can promote agglomerationbased on the analysis above, including general countermeasures to boost the industrypark development and special ones to further the development of Yixian IndustryPark and the main area in the development zone, the other is to summarize theresearch achievements, the shortcomings of this paper and the further research issues.