Spatiotemporal changes of manufacturing firms in the flood prone Yangtze Delta

ABSTRACT Manufacturing firms in flood prone areas (FPAs) are a vital component of flood exposure, driving the non-stationarity of flood risks. This paper explores the spatiotemporal patterns of manufacturing firms in the FPAs of Yangtze Delta in China during 1998-2013. It is found that the number of firms in the FPAs increases remarkably by 44,385, with an annual growth rate of 10.2%. Established firms are located much closer to water bodies, mainly agglomerating along the coasts, the Yangtze River, and around the Taihu Lake. Several vulnerable sectors, including chemical feedstock and chemical manufacturing, computer and communication equipment, maintain a high growth and share in the FPAs. The small and medium-sized enterprises (SMEs) with less flood coping capabilities increase rapidly. The main drivers of firm expansion in the FPAs include policy promotion, agglomeration benefit and levee effect. Exposed firms show a high spatial co-locality with industrial parks and an upward trend similar to the length of levees, suggesting that government policies and flood defense strategies encourage flood exposure. The increase in exposed firms is positively correlated with the rise of flood losses in industrial sectors. Besides defense strategies, more attention should be paid to enhancing flood resilience at regional and firm levels.