Does industrial land price lead to industrial diffusion in China? An empirical study from a spatial perspective

Land price is an important part of production costs of industrial enterprises, which affects the enterprise location and further affects the industrial layout. There is a lack of research into the relationship of industrial land price and industrial diffusion in China. This paper aims to reveal the spatial distribution characteristics of industrial land prices and industrial diffusion scale index (IDSI). Using the spatial data of 2015, this study examines the spatial effect on the industrial land prices of industrial diffusion scale and its determinants by the Geographical Weighted Regression (GWR) model. The result found that the industrial land price shows the characteristics of spatial difference of districts and counties. The industrial diffusion scale index of eight industries have a spatial positive correlation in different cities. The empirical results prove that the impacts of industrial land price on the IDSI vary across industries. The effect of industrial land price has a remarkably negative effect on industrial diffusion scale. Market potential and trade freedom have positive impacts on the IDSI, while the local deficit has a negative impact on the IDSI. Finally, according to the results obtained, the industrial layout and transfer of the manufacturing industry need to be effective guide by the reasonable land price.