The Locational Dynamics of Manufacturing in China's Counties: Influence of Expressway Investment

Abstract

This study investigates the impact of expressway investment in China's counties. By identifying expressway accessibility through toll station locations, we estimate the manufacturing distribution along expressways for 2001–2005. We find that expressway accessibility promotes manufacturing employment for inland counties by around 41 percent; however, for coastal counties that already have high road density and dense manufacturing layouts, the returns from new expressways are small. Furthermore, counties close to large cities benefit more from expressway accessibility than do counties that are far from them. The gap first increases in the period of expressway construction and then decreases as expressway effects are smoothed.