Analysis On The Upgrading Of China's Manufacture Industry

Under the framework of the efficiency and division of labor, this paper demonstrates the mechanism of the upgrading of the manufacture industry; Combined with the outstanding problems, it analyzes that the inefficient division of labor system and low transaction efficiency constraints the upgrading of manufacture industry and makes the empirical testing; Finally, from the perspective of division of labor, it makes some recommendations to promote the upgrading of manufacture industry.Including the first chapter introduction, the paper is constituted by the six chapters.The second chapter is literature review. On the one hand, the chapter reviews and comments on the division of labor theory. The division of labor is the basis of industrial organization, but also the causes of its changes, it means that the evolution of industrial organization and change, which led to the development and optimization of industrial structure. As the most important theory, division of labor theory experiences the "negation of negation" process, which had been the core issue of economics was gradually fading out the framework of mainstream economics, and then once again arouses the attention and have been developed, the author follows the context of the theory, recalls the classical understanding of economics, summarized the thinking of Marx's division of labor, comments on the new classical economics theory and combs the new classical economics. On the other hand, the chapter makes the literature review on the division of labor as an important motive for upgrading of the manufacture industry. The division of labor is the logic and theoretical basis to explain China's manufacture industry upgrading and the development of the producer services.The third chapter focuses on the industrial upgrading and motivation under the theoretical framework of the division of labor.The division of labor is an important source of power to promote economic development, this chapter analyzes the rationality and feasibility of the problem, explores the internal mechanism that upgrading of manufacture industry can be realized. Manufacturing is the most active areas full of developed division of labor, industrial upgrading results from division of labor. Therefore, industrial upgrading lies in the evolution of division of labor. Deepening division of labor brings about the income, in the same time, it will inevitably increases transaction costs. Improved transaction efficiency has played an important role in promoting the evolution of division of labor and industrial upgrading. Division of labor and the evolution of transaction efficiency can generate a powerful driving force of labor productivity, which is to promote fundamental changes in industrial structure and motivation. In accordance with the new classical economics point of view, the evolution of division of labor and transaction efficiency will promote the emergence of new machinery and endogenous technological progress. A division of the network with full-scale and sufficiently transaction efficiency is necessary for the new technology, new products and new industries. The division level and transaction efficiency promote the development of science and technology and further promote the development of industrialization, which are one of the fundamental forces for the evolution of industrial structure and have a decisive role in industrial structure. Higher professional and technical human capital, modern production personnel can perform jobs in service industries, human capital endowment differences cause industrial division and inter-regional differences in industrial structure. Involved in division of labor, each has different knowledge from the other producers, the total accumulated knowledge of society are more than any one has, and each professional producers has more knowledge under division of labor than self-sufficient, human capital is of progressive effect.Evolution of division of labor and transaction efficiency promote the productivity, technological progress, human capital improvement, progressive and capital accumulation, greatly promote the industrial upgrading in manufacturing, and ultimately lead to the origin of producer services and evolution. In the structure of manufacture industry, the division of labor constantly changes in two levels, on one hand, as the internal division of labor expands and deepens in the manufacturing sector, the intermediate demand greatly arises from various intermediate products, including design, product development, marketing, sales, consumption, after-sales service and a series of activities, etc., these sectors are of advanced scientific and technological knowledge and high levels of human capital, part of them is led by new demand factors, the other part may be the function of existing services in the enterprise; On the other hand, with the increasing levels of transaction efficiency, when the internal division of activities in firms or industries develop to a certain extent, industrial structure will appear more and more divided, the producer service activities have increasingly spun off from industrial areas and perform externalization, and finally the industrial structure of society will shift.The fourth chapter is about the present situation of China's manufacturing industry and the urgency of upgrading. The value-added of producer services are often much higher than the manufacturing sector, the countries and regions with earlier derived producer services often mastered the higher value-added technical and marketing aspects in final product, which get higher profits They gradually transfer lower value-added production and processing to the countries with cheap labor. China's manufacturing industry is in the low added value, low-tech, low-level position of the international division of labor in the value chain, as our labor and other production factors prices up, resources and environment have been severely damaged, so it is an urgent need to transform our country from "a big manufacturing country" to "a manufacturing power", achieve the upgrading the manufacturing industry. The fifth chapter is about the prominent problems of the manufacturing industry upgrading and empirical analysis. Inefficient division of labor and lower transaction efficiency, to some extent, has hampered China's upgrading of manufacture industry and producer services development. The "Self-sufficiency" traditional concept and the ideological constraints of the planned economy, all-backward production organization, large and regional industrial structure and local protectionism behavior cause our low manufacturing division of labor, there is no effective division of labor and cooperative system; Venture financing difficulties, inadequate supply of public services, the immature market intermediaries and the legal system means low transaction efficiency is to be improved. We use panel data estimation methods, make the empirical test about the market index and industry contribution rate of 30 provinces and regions in 1997-2007, draw industry contribution rate and market index is a positive correlation , the provinces with higher transaction efficiency has higher contribution rate of manufacturing, transaction efficiency and manufacturing power has relevance, raising the level of transaction efficiency is bound to promote the development of manufacturing industry, Jiangsu,Zhejiang and other eastern provinces with the strongest manufacturing industry, to some extent, due to their higher transaction efficiency; we make the empirical test about the market index and industry R & D investment intensity of 29 provinces and regions in 2003-2007, and the correlation between two variables were analyzed and verified, the provinces with higher transaction efficiency, the higher technological innovation manufacturing they have, the transaction efficiency and manufacturing technology innovation ability have a positive correlation , and the transaction efficiency is an important variable to promote the manufacturing technology innovations; We organize and calculate the contribution rate of China's industrial and service contributions in 1978-2008, and the Granger causality test is conducted to verify the causal relationship between the service and manufacturing production, indicating the development of the manufacturing sector provide a solid foundation and strong support to producers service industries, the development of producer services is a necessary structure to upgrade the manufacturing industry, and has greatly promoted the development of the manufacturing sector. At present, the Yangtze River Delta's manufacturing industry has begun to climb from low value to high value-added links and the benefits gained from global value chains has increased. On the basis of a strong manufacturing sector in Jiangsu and Zhejiang Province, Shanghai has become a producer service center, the Yangtze River Delta forms the pattern with Shanghai as the producer service center and Zhejiang, Jiangsu coordinated development. As the center of the area, Shanghai's producer services do not only serve the region, but also plays a very strong radiation effects on the surrounding areas, and promote the Jiangsu and Zhejiang provinces to enhance the competitiveness of the manufacturing sector and climb to the high-end of the value chain.The sixth chapter is the summary and suggestions. Based on this analytical framework and relevant conclusions, the author gives the countermeasures to realize the upgrading of manufacture industry. "Twelfth Five-Year Plan" clearly pointed out we should adhere to the strategic adjustment of economic structure to accelerate the transformation of economic development, and focus on optimizing the manufacturing industry structure, improving the core competitiveness. "Twelve Five" is in the transition period of the mid-to late industrialization, but also when China's manufacturing get out the predicament of international financial crisis, and gradually goes towards prosperity, how to break the key to enhance the position of manufacturing industry in the value chain is a serious problem. Therefore, from the perspective of division of labor, we should continue to promote the market process, speed up transformation of government functions to carry out institutional reform and innovation, to break administrative barriers between regions and reduce the cost of factor mobility, to perfect the market system, improve the competitive environment and market transactions efficiency , provide the necessary conditions for the improvement of the division of labor in all levels, and the upgrading of industrial structure, the agglomeration externalities of producer services. First, to establish the division and cooperation system to guide interaction model of manufacturing industries and producer services; second, to improve industrial concentration, and form rational pattern of large enterprise-led medium and small enterprises coordinated; third, to strengthen public service facilities, and promote the development of market intermediaries; Fourth, to improve intellectual property protection system, accelerate the construction of social credit system; Fifth, to build the innovation system, create a favorable external environment for industry upgrading.