Influence of Economic and Financial Openness in Urban Agglomerations of Major Bay Areas

ABSTRACT

This paper examines how four indicators of economic/financial openness, namely, trade openness, actual tariff rate, financial openness, and investment openness have shaped the world’s four major bay area’s urban agglomerations. The study considers four key bay areas, New York, Tokyo, San Francisco and Guangdong-Hong Kong-Macao, over the period 2005–2018. Using the panel data fixed effect model analysis, our study finds that: the interaction of comprehensive openness, investment openness, trade openness and comprehensive openness plays a positive role in economic growth, while the actual tariff rate and financial openness play a negative role. In the long run, each bay area should expand their opening-up to the outside world and promote economic growth.

KEYWORDS:

• Bay area
• openness
• economic growth
• New York
• Tokyo
• San Francisco and Guangdong-Hong Kong-Macao

JEL:

• F 49
• F 62
• G 00

Acknowledgments

We would like to thank all of our co-authors and the people who has helped us to collect the data. This paper was published in accordance with a project. Funded project name: Guangdong Province Educational Science “Thirteenth Five-Year Plan” 2020 Project. Research on the countermeasures of promoting high-quality trade development between China and the countries along the “Belt and Road” in the post-epidemic period (project number: 2020GXJK111)

Conflicts of Interest: The authors declare no conflicts of interest.

Disclosure Statement

No potential conflict of interest was reported by the author(s).

Notes

1. This report is a research result compiled by Liu Yanping as chief editor, Li Chao, Huang Hao, Wang Fangfang, and Zhang Fangbo as deputy editors. The research results of the cooperation between the Institute of Finance and Economics of the Chinese Academy of Social Sciences and Sun Yat-sen Research Institute-”Report on the Impact of the Four Bay Areas (2018): New York, San Francisco, Tokyo, Guangdong, Hong Kong, and Macau.

2. Foreign direct investment (FDI) is a category of cross-border investment in which an investor resident in one country or territory establishes a lasting interest in and a significant degree of influence over an enterprise resident in another country or territory.

Additional information

Funding

This study was funded by Guangdong Province Educational Science “Thirteenth Five-Year Plan” 2020 Project (NO. 2020GXJK111).