Abstract
Using the method of non-linear relational threshold model，this paper investigates the effects of trade openness on the nexus of industry agglomeration and TFP growth of China's 28 manufacturing branches. The results show that the thresh- old effects of trade openness exist. In the case of higher level of openness，the effects of industry agglomeration on TFP growth will be more remarkable，and technical progress is the main channel through which agglomeration promote TFP. However，on the other hand，agglomeration hinders the improvement of technical efficiency in the higher level of openness scenario，which may relate to the negative externality of high agglomeration.
Key words: industry agglomeration; total factor productivity; trade openness; threshold effect
Author of the Article
Li-li Wang, Institute of International Economy，University of International Business and Economics，Beijing 100029，China.
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