An Assessment of the Impact of Spatial Agglomeration on the Quality of China's Wood Processing Industry Products

The influence of industrial agglomeration on corporate export behavior has been widely studied by both industry and academia. However, few studies have explored the impact of the spatial agglomeration of China's wood processing industry on the quality of its products at the micro level. In this study, we analyzed data from the China Customs Database to determine the quality of wood processing industry products at the enterprise level. Then, we matched the China Customs Database with the data in the China Industrial Enterprise Database. Based on this, we analyzed the impact of the spatial agglomeration on the quality of wood products using panel data regression. According to our results, spatial agglomeration of the wood processing industry can significantly improve product quality. Also, private enterprises are more likely to benefit from the advantages conferred by agglomeration than state-owned enterprises. Moreover, trade method does not significantly modulate the effect of spatial agglomeration on the quality of wood products. Last but not least, the agglomeration has the most significantly positive impact on the quality of products produced by the wood chip processing industry, followed by the wood products industry and the wood panel industry. Agglomeration of the bamboo and rattan palm industry actually decreases product quality. Therefore, we encourage agglomeration of timber processing enterprises, especially privately owned wood chip, wood product, and wood panel enterprises, to fully realize the benefits of the agglomeration economy. We also make policy recommendations to improve wood product quality.