Bay Area Economic Integration in China

Abstract: The Guangdong-Hong Kong-Macao Greater Bay Area is a regional economic integration development model that stems from the economic cooperation and exchanges between Hong Kong, Macao, and the Pearl River Delta region over the past 40 years. The construction of the Guangdong-Hong Kong-Macao Greater Bay Area will enable the economic integration and development of this region and promote the construction of the Belt and Road and the expansion of the state's level of openness to the world, driving and radiating the development of other regions. This thesis aims to provide empirical evidence on whether the integration policy of the Guangdong-Hong Kong-Macao Greater Bay Area can promote regional economic development. This thesis firstly briefly reviews the development history of the Guangdong-Hong Kong-Macao Greater Bay Area and reviews the Chinese and international literature on the background of regional economic integration, the Bay Area economy and economic growth. Secondly, this thesis presents a theoretical review and summary of regional economic integration theory and the centre-periphery model. Again, this thesis tests whether there is an economic growth effect of the policy of establishing the Guangdong-Hong Kong-Macao Greater Bay Area as an integrated region through a Difference-In-Differences method and measures the magnitude of the effect. Finally, based on the findings of the empirical quantitative analysis, a discussion on the continued economic development and integration of the Guangdong-Hong Kong-Macao Greater Bay Area is presented. The thesis concludes that there is an economic growth effect of the policy of GBA integration and that the economic growth rate of the 11 cities in the GBA has increased to a certain extent.