An Empirical Study on Industry Convergence in an Underdeveloped Area: Shanwei, Guangdong, China

Abstract

The present paper studies the convergence of industry in Shanwei, a coastal city in Guandong province, China. The data originated from the Shanwei Statistical Yearbook 1990-2021. The Herfindahl-Hirschman Index is used to evaluate industry convergence. The Grey relational analysis assesses the contributions of the three industries’ added values to local GDP. The regression model verifies if the industry convergence is conducive to economic growth. The results first indicate that Shanwei City’s economy shows a significant increase in the proportions of the manufacturing and service sectors and a sharp decline in the ratio of the agricultural sector. Second, the service sector contributes the most to GDP, followed by the agricultural sector, with the manufacturing sector contributing the least. Third, industrial convergence is driving regional economic growth. This study’s theoretical contribution outlines the relationship between Shanwei City’s industrial convergence and regional economic development. The proposed policy recommendations are valuable for adjusting its industrial framework and promoting high-quality development.