Cross-Border Economic Cooperation Between China and Southeast Asian Countries (Research Series on the Chinese Dream and China’s Development Path)

"This book focuses on how to promote cross-border economic cooperation in the context of China national strategy including BRI. This book summarizes the existing regional economic development theories and sorts out the relevant theories of cross-border economic cooperation. Then, it analyzes the industrial development of China's southwestern border and neighboring countries, the main reasons of rural household poverty in the border ethnic areas by means of empirical methods, and proposes corresponding policy implications. Also, it explores the current border investment and trade policies of China, and compares the similarities and differences between China and Vietnam, and Laos and Myanmar."-- Page 4 of cover Series Preface 6 Foreword 8 Preface 11 Contents 16 1 Theories of Border Economic Zones 20 1.1 Theories of Industrial Clusters 20 1.1.1 Alfred Weber’s Theory of Agglomeration 21 1.1.2 Alfred Marshall’s Theory of Industrial District 21 1.1.3 New Economic Geography 22 1.1.4 Theory of Competitive Advantage 22 1.2 Institutional Economics 23 1.2.1 Cluster from the Transaction Costs Perspective 24 1.2.2 Social Network Theory 25 1.2.3 Local Innovation Theory 25 1.3 Unbalanced Growth Theory 27 1.3.1 Francois Perroux’s Growth Pole Theory 27 1.3.2 Gunnar Myrdal’s Circular Cumulative Causation Theory 28 1.3.3 Albert O. Hirschman’s Core-Periphery Theory 29 1.3.4 Gradient Transfer Theory 29 1.3.5 Geo-Economics 31 1.3.6 Location Advantages 32 1.4 Theories About Cross-Border Economic Cooperation and Related Empirical Studies 32 1.4.1 Relevant Theories 33 1.4.2 Empirical Studies 36 References 38 2 Economies and Industries of Border Regions in China’s Southwest and Its Neighboring Countries 39 2.1 Border Economic Zones (BEZs) 39 2.1.1 BEZs on the Border Between China and Vietnam 41 2.1.2 BEZs on the Border Between China and Laos 43 2.1.3 BEZs on the Border Between China and Myanmar 44 2.2 Profiles of Industries 47 2.2.1 Industries in Yunnan, China 47 2.2.2 Industries in Lao Cai, Vietnam 51 2.2.3 Industries in Laos 52 2.2.4 Industries in Myanmar 52 References 53 3 Resistance to Cross-Border Trade Due to Border Effects and Its Influencing Factors 54 3.1 Introduction 54 3.2 Model Construction 56 3.2.1 Construction of the Model 56 3.2.2 Influencing Factors of Border Effects 57 3.3 Data Sources and Processing 58 3.3.1 Data Sources 58 3.3.2 Data Processing 59 3.4 Results and Analysis 60 3.4.1 Estimation of the Resistance Caused by Border Effects 60 3.4.2 Influencing Factors of Border Effects 62 3.5 Conclusions and Policy Implications 63 4 Factors Affecting Firm-Level Investment and Performance in Border Economic Zones and Implications for Developing Cross-Border Economic Zones Between the People’s Republic of China and Its Neighboring GMS Countries 65 4.1 Introduction 65 4.2 Background 66 4.3 Literature Review and Formulation of Hypothesis 67 4.4 Methodology 69 4.5 Results 70 4.5.1 Nonparametric Analysis 70 4.5.2 Parametric Analysis 81 4.6 Conclusion and Policy Implications 99 References 103 5 Selection of Industries for Cross-Border Economic Cooperation 104 5.1 Introduction 104 5.2 Methodology 106 5.2.1 Analysis of the Disparities in Industrial Structure and the Industrial Linkages 106 5.3 Analysis of RCA and TC 107 5.4 Empirical Analysis 108 5.4.1 Data Sources 108 5.4.2 Calculation Results and Analysis 109 5.5 Conclusions and Policy Implications 116 References 117 6 Financing Environment in Cross-Border Regions 119 6.1 Introduction 119 6.1.1 Background 119 6.1.2 Literature Review 120 6.2 Analysis of Financial Structure and the State of Economy 122 6.2.1 The Financial Structure and the State of Economy of Yunnan, China 122 6.2.2 Financial Structure and the State of Economy of Yunnan’s Neighboring Countries 126 6.3 Descriptive Analysis of Statistics About Financing Environment 131 6.3.1 Initial and Follow-On Funding for Firms 132 6.3.2 Follow-Up Investment and Related Loans of Firms 134 6.4 Impact of Financing Environment on Investment of Firms 137 6.4.1 Impact on Investment Motives of Firms 137 6.4.2 Impact of Financing Environment on Follow-Up Investment 145 6.5 Impact of Financing Environment on Performance of Firms 150 6.5.1 Definition of the Variables and Model Estimation 150 6.5.2 Analysis of the Modeling Results 151 6.6 Conclusions and Policy Implications 153 Reference 157 7 The Impact of Cross-Border Economic Cooperation on Regional Economy 158 7.1 Introduction 158 7.2 Literature Review 159 7.3 Methodology and Data Analysis 161 7.3.1 Data Sources 161 7.3.2 Model Evaluation 162 7.3.3 Scenarios 164 7.4 Results and Analysis 168 7.4.1 Correlation Between Industries 168 7.4.2 Multipliers of the Impacts 169 7.4.3 Impacts on the Economy in Different Scenarios 171 7.5 Conclusions and Policy Implications 175 References 176 8 Principles and Influential Factors of Cross-Border Economic Cooperation Zones 178 8.1 Definition of CBEZ 178 8.2 Basic Principles of CBEZ 179 8.2.1 Use of Resources in Border Regions 180 8.2.2 Use of Complementary Resources Across the Border 181 8.2.3 Transformation of Peripheries to Centers 181 8.2.4 Low Costs of Public Utilities 181 8.2.5 Expansion of Markets and Economies of Scale 182 8.2.6 Peace and Stability 182 8.3 Functions of CBEZs 183 8.4 Stages and Modes of CBEZs 184 8.4.1 Stages of CBEZs 184 8.4.2 Modes of CBEZs 186 8.5 Factors Influencing the Performance of CBEZs 189 8.5.1 Regional Governance 189 8.5.2 Regional Institutions 190 8.5.3 Regional Financial Systems 190 8.5.4 Social Capital 191 8.5.5 Political Cooperation, Level of Economic Development, and Trade and Investment Barriers 191 References 193 9 An Institutional Economics Approach to the Construction of CBEZs 195 9.1 Literature Review 196 9.2 Analysis from the Perspective of Institutional Economics 197 9.2.1 Levels 197 9.2.2 Existing Problems 205 9.2.3 Mechanism Design 208 9.3 Case Study 211 9.3.1 The Position of the Border Areas Between China and Myanmar in the Rubber Industry 212 9.3.2 Problems Confronting the Rubber Industry in the Border Areas Between China and Myanmar and the Causes of Problems 214 9.3.3 Policy Implications 216 References 218 10 Conclusions and Policy Implications 219 10.1 Promoting Cooperation with Foreign Countries in Border Areas 219 10.2 Promoting Cross-Border Trade 220 10.3 Attracting Investment from Outside the Region 221 10.4 Promoting Industrial Development in Cross-Border Areas 222 10.5 Impacts of Cross-Border Economic Activities on Regional Economy 223 10.6 Establishing the Foundation of Institutions for CBEZs 225 10.7 Major Challenges in Establishment of CBEZs 226 References 229