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E-business and manufacturing agglomeration

This paper identifies the chain-mechanism of e-business affects the manufacturing agglomeration from the view sight of trade costs. Considering trade costs as a mediator variable for this chain-mechanism, a mediating model is built. The empirical checking of 28 manufacturing industries shows that e-business could promote agglomeration through lowering the trade costs. This effect is still robust in technology-intensive manufacturing industries, but it gets a negative answer on the sample of labor-intensive and capital-intensive manufacturing industries.