The structure of product space and regional economic resilience in China: towards an evolutionary perspective

ABSTRACT

Technology and knowledge play important roles in shaping regional economic resilience and are essential keys to fostering high-quality regional development. The paper utilizes domestic and foreign trade data, as well as economic and social development data, from 2001 to 2016 across 30 provinces in China. It aims to depict the characteristics of regional economic resilience and product space, conducting empirical analysis the impact of structure of knowledge-based product space on regional economic resilience. The objective is to explore how regions can promote structural transformation and economic development through knowledge networks. The study revealed that the relationship between knowledge contained within the product space is the key factor shaping economic resilience, particularly in terms of the existing knowledge nodes and the density between these nodes in the network. Owing to the impact of knowledge proximity, the process of promoting economic resilience through a relatively concentrated knowledge network is a path-dependent process. However, an excessive similarity between knowledge may lead to path locking. Therefore, our emphasis is on the structural relationships among knowledge within the region, providing a valuable an important supplement to the investigation of factors influencing economic resilience in networks.

KEYWORDS:

• Regional economic resilience
• product space
• evolutionary perspective
• path-dependence

JEL CLASSIFICATION:

• R11
• F43
• O47
• O36

Abbreviations

CEPII-BACI: Research and Expertise on the world economy-Base pour l’Analyse du Commerce International

Disclosure statement

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

Notes

¹ $RC{A}_{r,i,t}=\frac{\frac{X_{r,i,t}}{{\sum }_i{X}_{r,i,t}}}{\frac{{\sum }_r{X}_{r,i,t}}{{\sum }_r{\sum }_i{X}_{r,i,t}}}$, $RCA{x}_{i,t}=\left\{\begin{array}{c}1ifRC{A}_{r,i,t}>1\\ 0otherwise\end{array}\right.$, Where $X_{r,i,t}$ is the export value of goods i in region r of time t. If $RC{A}_{r,i,t}$ >1, it means that the product has revealed comparative Advantage,$RCA{x}_{i,t}$ = 1, otherwise it is 0. $RCA{x}_{i,t}$ indicates whether the product has RCA.

² note, as the matrix is symmetrical, the down triangle and diagonal of the matrix are removed.

³ Hebei is a major province in the eastern region, Shanxi is a resource-based province in central China, and Liaoning is an old industrial area in the northeast. Shanghai is located on the east coast, which is the economic centre of China. Meanwhile, Guizhou is located in western China and has experienced rapid growth in recent years.

Additional information

Funding

The work was supported by the National Natural Science Foundation of China [42130510].