Does Industrial Diversification Increase the Resilience of Economic Growth?
DOI:
https://doi.org/10.54097/fbem.v7i2.4849Keywords:
Industrial diversification, Economic resilience, Threshold effect.Abstract
With the rapid development of the global economy and the increasingly complex internal and external environment, economic resilience plays a crucial role in the stable development of the region. Using the panel data of 273 prefecture-level cities in my country from 2003 to 2019 as samples, and by constructing an empirical model of the relationship between industrial diversification, related diversification, irrelevant diversification and economic resilience, the study found that the relationship between industrial diversification and economic resilience was showing a significant inverted U relationship, a lower level of industrial diversification improves the resilience of economic growth, but a higher level of diversification inhibits the enhancement of economic resilience. In the further threshold effect test, it is found that there is a double threshold effect on the level of economic development between industrial diversification and irrelevant diversification and economic resilience. The policy implication of the conclusions of this paper is that the government should make the optimal choice between industrial diversity, economic efficiency and growth stability to enhance the regional economic resilience.
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