Industrial Agglomeration of the Food Industry in China: An Analysis of Data by Province

Abstract

On the basis of statistical data from provinces and autonomous regions, we analyze trends in industrial agglomeration in the food industry using specialization coefficients and the level of gross industrial output, and examine their relationships with the rate of return in the industry. We showed that the level of gross industrial output of China’s three major food industries (food processing, food manufacturing, and beverage manufacturing) which accounts for 7.5 % of all industries, increased 1.66 times in the period between 1999 and 2003. Agglomeration had been even accelerated in provinces with high rate of agglomeration at the beginning of the period. Provinces with a large share of food processing and manufacturing production had a growing share of the output of food industry as a whole; however, those with a large share of beverage manufacturing production did not necessarily account for a large portion of food industry production as a whole. The positive correlation between the specialization coefficient and the profit margin on sales in food industries supports the positive externality effects of agglomeration within the industry.