Organization and Spatial Structure that affects Beijing’s Economy
After I reading the article of “Strategic Management of Places”, and I know there are six dimensions of organization and special structure. The first dimension is that monopoly firms processing market power. The second dimension is that many firms are in the situation of competitive markets. The third is that many small or middle entrepreneurial startups also promote the economy of that region. The forth one is that specialize one field and take advantage of this field scale to reduce the transaction expenditure. The fifth dimension is that the region should have the diversity. And the last dimension is that cluster is very important. Although, not all these dimensions exist in one place, they still play an important role for the economy development for a place.
And the place of interest I would like discuss is mainly focus on Beijing. Beijing is the capital city of China, ...view middle of the document...
Although, the government is not the investor for this policy, it still holds the market power to control the price of the housing in Beijing.
a. There is no competition markets in my policy. As I said in the market power, the Beijing government holds the market power to control the price of affordable house. So, no other firms could be competitive with government. For example, the Beijing government makes the price of affordable houses at 6000 RMB per square meter for low-income families. Which company can make higher price than this price for selling to low-income families.
3. Entrepreneurial Startups
a. Although in this policy, the government is responsible for the construction and selling price for the affordable houses. But, this policy still could attract many small firms. To be exactly, except for the construction and price, the affordable houses also needs to be decorated from many small decoration companies to finish. And if people live in the affordable houses, they will need the furniture for their houses. And for this way, many small furniture firms could startup near the affordable houses.
a. The affordable housing would not increase Beijing’s specialization in houses selling, because that Beijing government supports the affordable houses.
a. The affordable housing policy cannot bring the diversity for Beijing economy. Firstly, the affordable housing policy is for the low and median income families. So, it only attracts these people to purchase the affordable houses. Secondly, although the increase of affordable houses, which rein in property price rises, it still has no influence on diversity economy on Beijing.
a. Clusters within the city of Beijing
There is a technology industry cluster located in Haidian District of Beijing, which consist of Baidu, Lenovo, and other giants. And this technology industry is celled Zhong Guan Cun Science Park. It is very similar to Silicon Valley.
b. Cluster of affordable housing policy
There are many real estate firms to construct affordable houses. Thus, there is a cluster of different companies to do this project together, such as the decoration companies, water companies, electricity companies and etc.