Market similarity and the evolutionary path of China's export market expansion
GUO Qi1,, ZHU Shengjun2,
1. College of Economic and Social Development, Nankai University, Tianjin 300071, China
2. College of Urban and Environmental Sciences, Peking University, Beijing 100871, China
Based on the extended gravity model and evolutionary economic geography, this paper uses Kernel density distribution and econometric models to investigate the path of export market expansion in urban China and its micro-mechanism at the firm level by using 2002-2011 China Customs Database. To quantify the evolutionary path of export market expansion, this paper measures the inter-national market similarity based on the co-occurrence analysis and then calculates the market similarity between export destinations and firms' (or cities') export market network, which is used as an important explanatory variable in the econometric models. The results show that the market that is more similar to cities or firms' previous destinations is more likely to be expanded as a new destination, implying that cities' and firms' export market expansion in China presents the pattern of path dependence. This study also examines the co-evolution of cities' and firms' market expansion. The city-level evolution in the east is path created, which may derive from firms' path dependence. Knowledge spillover effect within the same city plays a significantly positive role in the firms' market evolution. Therefore, the co-evolution of cities' and firms' market expansion is the key mechanism of export market expansion path in China.
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