Regionalizing the Global-Local Economic Nexus: A Tale of Two Regions in China GCP-06-01

Xiangming Chen
Professor of Sociology at the University of Illinois at Chicago

The study of regions has been undergoing an intellectual “renaissance,” resulting in a growing literature on the renewed importance of new and more varied forms of regions and regionalism. This literature has focused on supranational regional schemes such as the EU, NAFTA, and APEC on one hand, and within-country dynamic or declining regions like the Silicon Valley, the industrial districts, or the heavy industrial areas in Europe or the United States on the other. However, insufficient research has been devoted to other geographical scales and political contexts where regions have become the “crucial middle” for integrating global, national, and local economies. This stronger role of regions can also turn them into more contested terrains for the diverse tensions and outcomes of economic integration or lack of it to play out, especially in terms of simultaneous tendencies in competitive and cooperative policies and practices of subnational and local governments, special-purpose authorities, and global and local firms. In this paper, I offer a new framework for conceptualizing and analyzing region as capable of mediating or restructuring global-local economic relations in varied ways. This framework allows region to be scrutinized as a more active and dynamic entity for investment and economic growth, which nevertheless faces a greater dilemma of fostering collective efficiency and welfare through a rational regional division of labor and cooperation while forestalling extreme intraregional or inter-local competition through unbridled location incentives under the condition of accelerated capital mobility and more discriminating global investors. Using this framework to guide a comparative analysis of the Pearl River Delta (PRD) and the Yangtze River Delta (YRD) in China— two of the most dynamic manufacturing regions in the world, this paper describes the structural and spatial formations of regionalized global-local value chains and production networks, analyzes the opportunities and constraints for indigenous Chinese firms in these two regions to achieve industrial upgrading, and finally discusses the implications for new forms of regional governance.

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