Font Size: a A A

Estimates Of Total Factor Productivity And Its Contribution To Economic Growth Research

Posted on:2012-12-25Degree:DoctorType:Dissertation
Country:ChinaCandidate:J XuFull Text:PDF
GTID:1119330368981529Subject:Management Science and Engineering
Abstract/Summary:PDF Full Text Request
Reform and opening up for 30 years, the incremental reform has made remarkable achievement in China. The analysis report of World Bank indicates, it is unprecedented in the mainstream economic history that Chinese economic growth rate and the duration. However, since the Asian financial crisis in 1997, economists began to re-examine Chinese economic growth from efficiency angle. Former Soviet Union's (including the East Asian before financial crisis) experience shows that the key to economic growth is not achieved the highly growth in a period, but rather to achieve what kind of high growth, the sustainability of growth. Many scholars have pointed out that Chinese growth with a distinctive "extensive" feature, the contribution of total factor productivity is low, and Chinese economic growth mainly relies on input-driven. So, whthere Chinese growth and to what extent is the extensive growth? What's TFP contribution to the economy growth? Whether there is deterioration trend in total factor productivity? Therefore, based on collating and summarizing the research methods of total factor productivity, the article has an empirical research to total factor productivity and its contribution to economic growth in China. To find out how much is driven by capital and labor inputs, how much is caused by the technological progress in Chinese economic growth, and try to answer above questions.First, we estimate two important elements of inputs in calculating total factor productivity, namely fixed capital stock and labor inputs. On this basis, we calculate the total factor productivity and its contribution to economic growth in empirical research. In view of the subjective assumptions on fixed capital stock estimates in the existing research, in this paper, we deduce a formula to calculate capital stock by input-output table, and use the formula to re-estimate the fixed capital stock in Chinese overall economic and industrial sectors. While the existing studies generally use the number of employees over the years as the labor input index, which without considering the quality of the work to improve the contribution of labor input, thereby, reducing the labor input contribution to economic growth, lead to estimation of total factor productivity high. Therefore, we compile the labor input index that reflect the labor quality improvement by using of Tornqvist Index, and using the fixed capital stock that has estimated, we re-estimate chinese total factor productivity and its contribution to economic growth by Solow Residual Method.Secondly, according to the endogenous growth theory, we investigate TFP'S changes after the introduction of human capital variables. Through the review of human capital measurement methods, we choose the invest-cost method to estimate the human capital by educational investment formation, and further apply the perpetual inventory method to estimate the stock of human capital in China. On this basis, through the establishment of autoregressive distributed lag model, we have an empirical research on total factor productivity and human capital to economic growth.Lastly, utilizing the manufacturing sector and provincial panel data, we have an empirical study on the changes of total factor productivity in different sectors and regions by data envelopment analysis method, to identify industry and regional variation of total factor productivity, and explain the reasons for the change. By further decompose into technological progress and technical efficiency to total factor productivity, to grasp the deep-rooted reasons of TFP change in different regions and industries.The main conclusions of this paper are as follows:(1) By the estimation of fixed capital stock shows Chinese capital-output ratio on the rise from the overall trend, declining in capital productivity shows that our country is going through a process of capital deepening. Further, by analyzing the capital stock of industrial sectors, we draw a conclusion, since the mid-90s, Chinese major industrial sectors have emerged in the process of capital deepening, but after the 1998, there was no capital deepening phenomenon.(2) By the analysis of the labor input index shows that the improvement of labor quality is an important source of labor input growth in China, and as time goes on, labor quality improvement to the contribution of labor input is growing. By analyzing the contribution of factor inputs from 1990 to 2007 year, we find the capital input contribute to economic growth more than 60%, which indicate Chinese economic growth at this stage is still to rely on capital-driven. From a different period of time, the contribution of labor input steadily improved, but slow, while the contribution of total factor productivity declined year by year.(3) By estimating total factor productivity after the introduction of human capital variables, the results show that human capital is second only to physical capital, and has become the second largest economic growth driving force, and since the introduction of human capital, fully decompose the " Solow residual value ",so TFP's contribution to economic growth decreased significantly. Further analysis to the model results show that the input and output efficiency of human capital is much higher than physical capital, human capital investment effect has a certain lag, therefore, China should further increase investment in human capital at the present stage.(4) Based on provincial panel data, this paper applies Data Envelope Analysis Method to calculate TFP, the results shows, the yearly TFP growth rate is about 2.5% and accounting for 25.07% of economic growth during 1993-2008. The growth rate and contribution rate is relatively very satisfied. By further decomposition of TFP shows the growth driven by technological progress at an average annual growth rate of 3.5%, while the technical efficiency at an average annual rate of 0.9% offset the contribution of technological progress. From a regional perspective, the TFP growth rate of eastern region is the highest in each period. Further decomposition of TFP in different regions found technical efficiency in eastern region is fastest, while the central region has the slowest growth in technical efficiency, technical efficiency growth differences is the main reason that lead to TFP growth in central and western regions behind.(5) Based on manufacturing panel data, this paper applies Data Envelope Analysis Method to calculate TFP, the results shows, the TFP change in Chinese manufacturing industry has undergone three stages:the faster growth in 1991-1993 year, decline from 1993 to 1998 year and the rapid growth after 1998 year. Generally shows a first and then decreased, and then quickly picked up momentum. By further decomposition of TFP shows the growth mainly stems from technical progress, while technical efficiency at an average annual rate of 1.4% offset the contribution of technical progress. By the decomposition of industry TFP, we obtained more meaningful conclusion. Generally, the state-owned or monopoly industry has high technical progress, however, technical efficiency declined significantly; the industry with some competition and a certain technical threshold has improved technical efficiency obviously and technical progress has been a slowly growth; the industry with low technical threshold and competition, the technological progress is the worst.
Keywords/Search Tags:Total Factor Productivity, Fixed Capital Stock, Labor Input Index, Human Capital Stock, Data Envelope Analysis Method
PDF Full Text Request
Related items