Dispersion or concentration? The impact of intelligent manufacturing on industrial agglomeration

This paper examines the impact of intelligent manufacturing on industrial agglomeration using a matched panel of Chinese industrial firms and customs data. We use the number of imported industrial robots as a proxy for intelligent manufacturing adoption to identify its effect on industrial agglomeration. Our results show that intelligent manufacturing acts as a powerful centralizing force, significantly increasing industrial agglomeration. We find that this effect operates through three primary channels: capital deepening, labour-force skill upgrading, and tighter integration between manufacturing and producer services. Moreover, the pro-agglomerative effect varies systematically across industries and is particularly pronounced in light, large-scale, capital-intensive, and digitalized manufacturing industries.