Agglomeration effects, firm performance, and regional economic growth : evidence from investment promotion Bureau of Zhangzhou Development Zone

Abstract

The spatial agglomeration of economic activities, as an important feature of modern economic growth, has a series of potentially important effects on the development of enterprises and regions. This study is devoted to an in-depth exploration of the agglomeration effect of enterprises in economic development zones, the transmission mechanism and the impact on local socio-economic development. Through an in-depth study of the Zhangzhou Economic Development Zone as a case study in the southeastern coastal region of China, this paper firstly explores the existence of the agglomeration effect of enterprises and its impact on the decision of new enterprises to move into the zone. Secondly, the actual impact of agglomeration on firms' production and development is examined, including the positive effects of agglomeration and the effects of increased competition on firms. Finally, the important impacts of economic development zone policies on business and economic development in the local and neighboring areas are explored. Detailed enterprise data collected for the study include basic information, occupancy and business conditions of enterprises, as well as economic development indicators at the regional level, which are combined with empirical data and quantitative analysis to reveal the impact of agglomeration economic effects on enterprises and the far-reaching impact on the local economy. The study confirms the significant influence of agglomeration effect on enterprises' decision to locate in the area, and finds different responses of different sizes and types of enterprises to the agglomeration effect. In addition, through the empirical test of the synthetic control method, the study demonstrates the important contribution of the Zhangzhou Economic Development Zone to the local economy, including the positive promotion of employment, industrial structure, foreign trade activities, and environmental protection. The contribution of the study is that it provides concrete cases and in-depth empirical tests for studying the agglomeration effect, and provides important theoretical and practical support for the promotion and implementation of development zone policies.