An Empirical Study Based On The Impact Of Institution Changes On Chinese Economic Growth

What roles do institutional changes play in the economic growth for a country? How do the institutional changes influence the economic growth? What are the measurement and basis of institutional changes? Such questions have always been the focus for arguing in academic world. As the representative of the developing countries and the transitional countries, China has achieved such great economic growth that it draws the world’s attention in the process of reform and opening and system transformation, which makes China become a typical model in the research on the influence of institutional changes on the economic growth. However, among the achievements in research, scholars tend to think that the changes of economic institution has significant facilitation for China’s economic growth but put less emphasis on the changes of legal institution and political institution. In addition, there has been no systematic analysis on the influence of institutional changes on transmission mechanism and action mechanism. Obviously, such practices lacks in the grasp of the influence of institutional changes on the economic growth from all sides.Based on this, this paper makes a theoretical exploration and an econometric analysis of the influence of all kinds of institutional changes (economic institutional changes, legal institutional changes and political institutional changes scilicet administration institutional changes) on the economic growth in China. The main content and logical structure are written as follows. First, based on the modern economic growth theory and new institutional economics, it makes a literature review about the existing achievements, analyzes the deficiency as well as the space of further exploration and points out that economic institutional changes, legal institutional changes and political institutional changes are the main system types to influence the economic growth in China. Second, it proves that institutional changes actually influence the economic growth for a country through putting the factor of institutional changes into the existing economic growth model and expanding as well as deducing the theoretical model within and out of these institutions. Third, combining North’s state theory and China’s practical situation, it constructs the transmission mechanism of the influence of institutions on the economic growth in China and summarizes that the action mechanism of the influence of economic institutional changes, legal institutional changes and administration institutional changes on the economic growth in China respectively based on the existing research achievements. Finally, with the principles of statistical availability and the accuracy and rationality of choice of index selection, according to the data of time sequence in China, it constructs the index system of measuring all kinds of institutional changes. It makes an empirical study of the extent to which all kinds of institutional changes influence the economic growth in China and provides the corresponding conclusion and suggestions through unit-root test, co-integration analysis, vector error correct model, and granger causality test and so on.The constructed theoretical model of the influence on the economic growth in China under the guidance of "state will" includes the legal institutional changes and political institutional changes, which expands the scope of the existing researches and revises as well as improves the existing theoretical frames; through the investigation of the influences caused by economic institutional changes, legal institutional changes and administration institutional changes, it makes the researches become more comprehensive; through more scientific and rational empirical means, it avoids the spurious regression caused by traditional metering measures and makes the empirical results more credible and the corresponding suggestions on policy more purposeful and feasible.