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Essay / Analysis of the manufacturing industry in Shenzhen
The manufacturing industry in Shenzhen The increasing integration of global trade markets has led to the fragmentation of production activities, particularly in the manufacturing sector, with companies tending to outsource to foreign counterparts due to cost-effective advantages ( Feenstra, 1998 p.31). This modern production model characterizes the collapse of the “vertically integrated mode of production”, also known as the “Fordist” mode, specifically linked to the manufacturing process of Ford cars (Feenstra, 1998 p. 31). In order to recognize changes in production, conceptual frameworks related to outsourcing activities need to be considered. Ethier (1982) explores the growth of specialization among nations and significant efficiency gains in trade. By offshoring production, companies can reduce costs and lead times, generating greater profits. Shenzhen can be considered an exemplary city when studying the rapid growth of its economic sector. Shenzhen's competitive environment In August 1980, Shenzhen was declared China's first special economic zone for its image as a leading city and a key design hub (UNESCO, 2010). Shenzhen is considered the cause of China's economic success over the past thirty years due to its innovation and forward-thinking (UNESCO, 2010). Shenzhen is located near the Pearl River Delta in the southern area of Guangdong Province, China (SETRO, 2014). With more than three decades of growth, Shenzhen has become a major strategic base for research and development programs, manufacturing and export of electronic products. Shenzhen has been recognized as a four-pillar industrial city due to its advancements in the technology industry as well as information. .... middle of paper ...... has proven to be a key component of Shenzhen's manufacturing development and its contribution to the country's GDP (China Knowledge Press, 2004). Manufacturing has played a vital role in Shenzhen's economic boom, but this progress has come at a cost to society (Passport, 2013). The moral implications of such growth must be taken into account when considering the extent of the city's success, to the extent that the social consequences have been brought about. The poor conditions faced by workers at some manufacturing companies in Shenzhen can be seen as an example of the social consequences of economic success in China. Chan's (2010) analysis of worker discrimination confirms the need for stricter enforcement of government regulations. Overall, Shenzhen city's industrial success makes it an exemplary case study in economic growth..