Impact of Polycentric Urban Network on Industrial Structure Upgrades: Evidence from the Yangtze River Economic Belt

Abstract Polycentric urban networks (PUNs) have been found to be an important factor for urban economic growth. This study is based on a PUN analytical framework and features agglomeration effects and network externalities. We examine the relationship between PUNs and industrial structure upgrading, using a data set of 108 cities in the Yangtze River Economic Belt of China from 2005 to 2017. We find that the PUN is associated with an increase in the industrial structure upgrading index, but small cities benefit less from the network. In reference to spatial political economics, new structural economics, and product space theory, we build an analysis framework to explain the mechanism. The main channel is a positive effect of encouraging the spatial flow of factors, promoting regional integration, and enhancing urban innovativeness. This research has significant policy implications for discovering alternative avenues to reform the manufacturing industry and enhancing regional economic development efficiency from a spatial perspective.