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5719With the rapid development of industrialization and urbanization in coastal areas, the cost of labor factor and land factor in coastal areas is increasing, thus some manufacturing industries start to transfer from coastal areas to the central and western regions. Meanwhile, rural-urban labor begins to return for living cost and the unemployed rate increases. In recent years, a large amount of labor has returned and industries have transferred to the central and western regions, which has promoted the urbanization and economic performance of these regions.
This paper uses a spatial equilibrium model to analyze how rural-urban labor and industrial undertaking interact with each other by the “circulating cumulative effect”, and why it can increase the urbanization rate in the central and west regions. This paper uses the panel data of 18 provinces （municipalities directly under the central government, autonomous regions） in the central and western regions from 2011 to 2016 to analyze the fixed effect, and uses the data of Anhui and Henan to test the robustness. The results show that: （1） The return of labor force in the central and western regions promotes the industrial transfer from coastal areas to the central and western regions, while industrial undertaking in the central and western regions will promote the return of labor force, and the return of labor force and industrial undertaking will influence each other, forming a “circulating cumulative effect”. （2） The return of labor force alone or industrial undertaking alone cannot promote the level of urbanization in the central and western regions; only when the return of labor force and industrial undertaking form an interactive effect, can they jointly promote the level of urbanization in the central and western regions. The enlightenment of “double transfer” is that: （1） The return of labor force and industrial undertaking need to develop simultaneously. （2） The development of urbanization needs to be promoted by the return of labor force and industrial undertaking. （3） The level and quality of urbanization in the central and western regions need to be promoted according to the theory of industrial gradient development. （4） The development of urbanization in the central and western regions needs to vigorously attract the inflow of external funds, especially foreign capital.
