Market Platforms, Industrial Clusters and Small Business Dynamics
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Market Platforms, Industrial Clusters and Small Business Dynamics

Specialized Markets in China

Ding Ke

Specialized markets are a unique product of China’s economic transition. They are marketplaces located in industrial clusters, specializing in the wholesale of local commodities and related goods. Ding Ke reveals that, despite their seemingly primitive form, specialized markets appeared in many of the modern industrial sectors and were paradoxically upgraded and expanded as these clusters developed. He argues that specialized markets have also formed solid linkages with marketplaces in various cities in China and in other developing economies. A powerful, emerging market-oriented distribution system has thus appeared. Based on thorough fieldwork covering ten years, and using the novel theory of the platform, this book clarifies the unique development logic of specialized markets.
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Chapter 8: Local Government and Inter-Platform Competition

Ding Ke


Source: The author. Figure 8.1 Zhaoshang Market in Changshu apparel cluster 8.1 INTRODUCTION1 Chapters 8, 9 and 10 clarify the competition mechanism and the logic of upgrading in a market platform mode cluster by presenting a case study of China Changshu Zhaoshang City (Zhaoshang City). Changshu is one of the largest domestic-market-oriented apparel clusters and Zhaoshang City is the largest specialized apparel market in China. Zhaoshang City has grown in a mere 30 years from a street market into a huge specialized apparel market with 28,000 booths and a transaction volume of 30.6 132 M2920 – DING 9781781006276 PRINT.indd 132 20/06/2012 13:15 Local government and inter-platform competition 133 billion yuan. Accompanying this expansion, the number of sewing factories in Changshu increased from 160 to more than 5000. Some national level brands have made their appearance from among these factories. Careful investigation of such a market will be extremely suggestive to a study of the experiences of specialized market. Chapter 8 first focuses on the situation in inter-cluster competition. As has been shown in Chapter 2, in the market platform mode, intercluster competition is essentially competition between various platforms (marketplaces). As platform managers, the efforts of local governments to a large extent determine the result of the competition. This chapter thus makes an intensive and detailed study of the role of the Changshu government. 8.2 THE UNIQUE INDUSTRIAL CLUSTER FORMATION IN CHANGSHU Changshu is a county-level city under the administration of Suzhou, Jiangsu Province, with a population of about 1.84...

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