A Research On Evolvement And Causes Of The Regional Disparity In Labor Productivity Of China's Manufacturing

The research papers in existence on regional disparity in China have been quite abundant. However, there is no consistent recognition. Because the papers have some localization on hierarchy of research object,research methods and standpoints, farther work on the question is rather needed. This paper researchs on the evolution of labor productivity of China's manufacturing and makes explainations with some new views to growth performance, structural factor and agglormertaional effect. An empirical evidence form relatively microcosmic hierarchy has been afforded to understanding the regional disparity. It gains some significative results and provides several revelations on policy making.Firstly, the growth convergence of labor productivtity has been estimated to find out the evolution of regional disparity. Based on constructing dynamic economic spatial weight matrix, the marked spatial dependence in manufacturing's labor productivity has been finded. To control the effect of spatial dependence, several spatial econometric convergence models and dynamic panel convergence model using spatial fitering data have been used. The results show that the labor productivity has disconverged by 3% in 1988-1997, but converged by 4.5% in 1998-2005, which means that the disparity has been enlarged in the first period and reduced in the second period. The results are different from that on the macro-economy and so it is need to research the regional disparity on the more micro hiberarchy.To make sure the correctness of above conclution, the income distribution method has been used, and the conclution has been proved robust.Secondly, to relax the hypothesis of constant return to scale and redefine the space of technique sets, the decomposition method of the growth of labor productivity has been improved. Using the corrected decomposition method of the labor productivity's growth, the paper analyzes the drivers of evolvements of regional disparity in labor productivity of manufacturing, perspective on the performance of growth. The results are as follows. The main forces of the growth of manufacturing's labor productivity are variational in the two periods that are 1988 to 1997 and 1998 to 2005. Capital deepening is the whole source of growth in the first period and technology progress is dominant in the second period. However, the drivers of the evolvements of the regional disparity are not as same as the forces of growth. Technology progress is the driving factor enlarging the regional disparity in the first period and capital deepening is the dominant factor reducing the regional disparity in the second period.Thirdly, the effects of structural factors to the evolution of reginonal dispariatiy of manufacturing's labor productivity have been discussed. Using the rebuilt shift-share and natural decomposition of variance, the result shows that the effect of structural differences to disparity is minor. Then, after analysising the structural effect of growth, some results have been uncoverd, which structural change is a key factor to the gap reducing between the West and the East, but not a key factor to that between the Middle and the East.Lastly, the impace of agglomerational effect on the evolution of regional disparity of manufacturing's labor producitivty has been analyzed. The agglomerational effect has been estimated. It is different from the existent researchs that panel data model has been adopted, and static effect and dynamic effect distinguished, and spatial dependence of variable eliminated. Based on using spatial regime model to disginguish the agglomerational effects between the East and the Midwest and calculating the real changes of agglomeration structure, the agglomerational effect to disparity has been estimated. The result shows that the effect of specialization has a positive impact on the gap reducing between the Midwest and the East in the whole research period, and the effect of scale impacts positively on the gap reducing only in 1998 to 2005.In conclusion, in 1988-1997 and 1998-2005, the labor productivity of regional disparity in manufacturing evolved differently, which enlarged in the first period and reduced in the second period. In the first period, the effects of technology progress and industry-growth increased disparity. In the second period, capital deepening played actively to disparity reducing, but technique's catch up and technology progress don't do it. It shown that the mechanism of the neoclassical capital convergence, not that of technology convergence in technology diffusion theory, worked in the process of disparity reducing. Structural effect mainly acted on the disparity deflating between the West and the the East, implying that the convergence mechanism of structural change worked in the West. The effects of specialization and scale impacted positively on the disparity reducing, which root in the conjunct impacts of the agglomerational effect and the agglomeration structure's change. The above conclutions validate the validity of some growth theories, including neoclassical and new growth theories, on explaining regional growth dispatity and the evolution of regional disparity in China, providing some empirical facts.Based on the above conclusion, some policies and measures could be apopted: enhancing innovational ability, economic efficency and technology absorbency in the Midwest, and speeding up structural change, intensifying specialization, and promoting the industries transferation from the East to the Midwest.