From Market-Led to Institution-Based Economic Integration: The Case of the Pearl River Delta and Hong Kong

Abstract

The market-driven regional economic integration of the Pearl River Delta (PRD) and Hong Kong, similar to most East Asian cases of economic integration, has occurred in the absence of a formal institutional framework. Since the late 1990s, however, institutions have been playing an active role in promoting economic integration in East Asia. In the context of the changing nature of regional integration in East Asia, this paper argues that institution-based economic integration has been emerging between mainland China (especially the PRD) and Hong Kong since the early 2000s-twenty-five years after the ever-increasing socioeconomic interplay between the two began. This transition has occurred despite the unique framework of ”one country, two systems” adopted by transitional socialist China.