Research on the major factors which influence industrial agglomeration of the Pearl River Delta Area

This essay calculates the industrial agglomeration level of 9 cities of Pearl River Delta with the data of 20 two-digit manufacture industries in 1998-2010.The results show that the level rises with time passing.From the perspectives of new economic geography associated with opening up policy,some hypothesizes about the cause of industry agglomeration are proposed.The empirical result supports that positive feedback,average firm size,home market demand,transactional costs and different degree of opening up can significantly explain industrial agglomeration.