Business Cost Increases Promote Industria in the Yangtze River Delta Restructuring in the Yangtze River Delta

JIANG Jing1 ( 江静 ) and LIU Zhibiao2 ( 刘志彪 )

Editorial note：

The traditional view holds that China’s comparative advantage lies in low costs, and it is therefore imperative to reduce business costs if China intends to maintain her industrial competitiveness. In the following article, Jiang Jing and Liu Zhibiao present a rather different point of view. They consider it endogenous to increase business costs. Although they may reduce urban competitiveness to a certain extent, increased business costs exert an important “push” effect upon structural adjustment and upgrade and the growth of the regional economy due to the varying degrees of sensitivity of manufacturing industries and producer service industries to business costs. These findings have been corroborated through their analysis of business costs and industrial distribution in Yangtze River Delta cities such as Shanghai, Nanjing, Suzhou, Wuxi and Nantong.

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