Conference Agenda

Since the sovereignty change in 1997, Hong Kong has been transforming its role from a previous trade hub to an innovation hub linking China to the global market. The government of Hong Kong, which used to emphasize the laissez faire policies, has become more “interventionist oriented” to promote and launched a set of major policies and initiatives to improve innovation in the economy. Empirical studies on innovation in Hong Kong also arises in the recent 1-2 decades, which mostly focusing on the role of innovation policies and interventions by the Hong Kong government in fostering local firms’ innovation capacities and promoting commercialization of innovation. However, much less attention has been paid to the spatial dimension of innovation in Hong Kong.

This study aims to explore how the innovation activities in Hong Kong has been distributed and how it evolves over time, and how the geography of innovation is correlated with urban planning and design strategies in the recent decades. Three key sets of questions are explored here: 1) Where are the spatial clusters of innovation activities in Hong Kong over the recent decades? 2) What are the sectoral composition of innovation (spatial) clusters in Hong Kong? 3) Does the geography of innovation clusters in Hong Kong correlate with proximity to key transport infrastructure and services? How does the relationship between urban development pattern and the intra-regional spatial clustering pattern of innovation activities in Hong Kong change over time?

To measure innovation activities, this study collects patent data from the Intellectual Property Department of Hong Kong. Spatial analysis techniques will be applied to identify the innovation spatial cluster in Hong Kong in different years. A probability modeling framework will be applied to quantify the impacts of local urban environment factors on the likelihood of innovation concentration in each spatial unit. The results would provide useful insights on how to better align innovation policies with urban spatial development strategies in Hong Kong in the future.

There are a number of studies that examine the empirical role of different explanations
for the lack of capital flows from rich to poor countries (the so-called Lucas bias). This
paper makes a contribution to this literature by investigating the ability of “early ur-
banization” to account for this lack of capital flow. The current theory recognizes that
negative externalities are linked with early urbanization, which lead to wage rate in-
creases to compensate local workers for harm suffered. As the wage rate increases, the
locational advantages that caused these urban locations to grow in the first place are
reduced, compelling capital to relocate elsewhere. The paper demonstrates empirically,
through a time-series cross-sectional analysis, that urbanization has a negative main ef-
fect on the cross-border transactions involving foreign real estate assets and a positive
interaction effect with per capita GDP. This interaction effect means that the effect of
early urbanization on cross-border capital flows into real estate markets is more strongly
negative (positive) in nations in which per capita GDP is low compared to nations in
which per capita GDP is high. The results further show that, once having controlled for
early urbanization, the evidence for the Lucas bias disappears completely.

Since heterogeneous knowledge resources are unevenly distributed among cities, enterprises have gradually dispersed their activities to seek location-bound knowledge resources. Compared to the literature that emphasizes the "local buzz" for the agglomeration of enterprises to promote localized knowledge spillover, this paper constructs a micromechanism for a pipeline for knowledge spillovers among cities through the internal linkage of cross-regional enterprises. Empirical evidence confirms the impacts of spilled regional knowledge resources through headquarter–subsidiaries linkages to enterprises' innovation performance, which contributes to the enterprise strategy for geographical dispersion as well as policy-making for urban industrial and spatial planning.

Using the shift-share (or Bartik) instrumental variable to solve the endogeneity problem, this study shows a robust and negative effect of export shock on residential land supply in China during 2008-17 and the COVID-19 pandemic. We attribute this effect to a novel revenue-based fiscal consolidation measure: Chinese local governments’ intentionally increase urban land supply revenues to hedge against declining tax revenues from slowing exports. Consistent with the fiscal explanation, we show the effect is more prominent for negative export shock, revenue-oriented land supply, and cities with higher fiscal reliance on export. However, we find this land-based fiscal consolidation measure bearing unintended costs: it has led to excessive urban expansion, and a 1% decrease in export value increases Chinese residents’ commuting costs by RMB 0.664 billion (USD 91.467 million) per year. What’s worse, this measure is becoming less sustainable as its preconditions (high housing prices and sufficient land quota) are increasingly difficult to meet.