Cost Effects of Public Capital、Agglomeration Economies、and Accessibility on Local Industrial Development Disparities--A Case Study of the Counties in Taiwan

• Main Authors: Shi-sheng Yao, 姚希聖
• Other Authors: Yu-sheng Chiang
• Format: Others
• Language: zh-TW
• Published: 2002
• Online Access: http://ndltd.ncl.edu.tw/handle/12736915306772729269

博士 === 國立成功大學 === 都市計劃學系 === 90 === Abstract This study, based on the endogenous growth theory, constructs the industrial cost function by introducing three input factors including the public capital stocks, the agglomeration economy, and the accessibility that may affect production efficiency. Adopting the theorem of duality, the first factor, i.e. the public capital stocks, is treated as an unpaid factor of production and the last two factors are treated as the environment technology conditions affecting operations of firms. The data for empirical analysis is based on the Wealth Census of Taiwan where public economic and social capital stocks for counties in Taiwan are estimated by the distribution of major public investment to counties for central authority and provincial government and the annual expenditure of counties. Through the socioeconomic data for regions to establish the index of agglomeration economies by principal analysis, the road-network and traffics for roads above provincial level to establish the index of road-network accessibility, and the data of industrial operations for regions collecting by the Industrial & Commercial Census. The industrial cost function of Translog function type is constructed. The estimation results are used to analyze the effects that those of production environment conditions affect industrial production efficiency for business, transportation-communication & manufacturing, and services industry. Through the empirical analysis, the return to scale for industries are between 1.27 and 1.92 in Taiwan. It is found that the relationship for public economic capital to labors and that for public economic capital to capital factors are substitute but those for public social capital to labors and to capital factors are complementary for industries of business or services, while the relationships for public economic capital to those two kinds of factors are complementary but those for public social capital are substitute respectively for transportation-communication & manufacturing. In relation to the shadow price of public capitals for unit firm, the largest is 0.0452 in new Taiwan dollars for public economic capital of transportation-communication & manufacturing, while the least is 0.00058 for social public capital of business. It is found that the technological change of each industry is not Hick''s neutral. For business during the period of 1986~1991, the growth rate of total factor productivity (TFP), which arrives at 0.4076, is the largest among industries, while that for transportation-communication & manufacturing, arriving at 0.0544, is the least respectively. By comparisons between county clusters for industries, it is shown that the growth rates of TFP for clustered regions differ significantly and that the effect of production environment conditions on industrial production depends on the development degree of regions. For business as an example, in the former two clusters of counties, the main contributions to TFP growth are the effects of scale economies, technological change, public economic investment, and agglomeration economies, while, in the last three clusters of counties, sources to the growth rate of TFP include only in scale economies and in public economic capital. Another example is the services, the magnification of agglomeration economies contributes to the increase in the growth rate of TFP only in regions besides Taipei, Taichung, and Kaoshung. About the disparities in the effect of production environment conditions on development degree for regions, some important properties are found. These include: the production efficiency is significantly raised by the public economic investment for business and services; considering about the effect for agglomeration economies in saving production cost, the property seems significant on condition that, for business, the development degree for regions have to arrive at the lowest threshold of development degree while that for services cannot go beyond the highest threshold; the production efficiency of transportation-communication & manufacturing is significantly raised by public social investment, and the effect increases as the development degree of regions decreases; and the effect of road-network accessibility in saving production cost is significant only for transportation- communication & manufacturing, and the effect is stronger if the region is where this kind of industry is relatively inferior. In view of disparities in effect of production environment conditions on industries and regions, it is suggested that the short-run and middle-run development projects should be reevaluated in considering the spatial characteristics among regions. Key words: public capital, agglomeration economies, road-network accessibility, Translog cost function, total factor productivity