The Effect Of Marketization On Regional Economic Development

According to the experience of the 30 years’ reform and opening up,marketization has become the driving force of regional economic development.In the process of economic transition and structural reform,market-oriented economy has not only solved the problem of inefficient or ineffective resource allocation,but also the ossified institutional mechanism under the restriction of the traditional concepts,effectively raising the efficiency of resource integration and market expansion to achieve a sound and rapid development of China’s economy.However,according to the overall economic situation in recent years,China’s GDP growth has slowed down,starting from the period of rapid economic growth to high-and middle-speed in the New Normal.In particular,regional differences in economic development is still too large to undertake industrial transfer and participate in urbanization effectively in less developed regions,which are difficult to become "regional maneuvering room" of China’s economy.So,are there bottlenecks in the marketization process?Could it continue to be an important driving force of economic development especially in less-developed regions?This paper attempts to explore the relationships between regional economic development level and marketization level to provide a tentative solution to the issue.Firstly,the paper explores the spatial and temporal differences in Chinese regional economic development from various angles.The results show that China has made remarkable achievements in its economy since the reform and opening up,with the quality of economic development significantly improved,economic growth gradually transferred.The pace of economic development,however,slows down,which is basically in line with the mainstream of current judgment to China.Unlike the simple division of the convergence and divergence theory in regional economic development,the regional economic disparities embody the characteristics of the stages.The global financial crisis in 2008 was an important turning point.The regional economic development disparities in the early periods present diffused characteristics,which then turn into convergence characteristics in the later periods.Undeniably,there are still significant differences in the western and north-eastern regions.Thus it can be seen that the overall and regional economic developments in China have undergone a significant change.The positive reply to the issue is the important evidence to judge the impact of marketization process to regional economic development,which is about whether there is consistency in the temporal differences between them.Therefore,it is particularly necessary to explore the spatial and temporal differences of market level in China.Secondly,the paper constructs evaluation indicator system based on economic agents,production factors and legal environment as the core environmental dimensions,and measures the marketization levels from 1997 to 2013.The results show that the levels of the marketization increased from 4.40 in 1997 to 7.37 in 2013.The overall trend remains upward steadily,but a downward trend is found in growth in recent years,which is in accordance with the overall Chinese economic development process.In the three dimensions of the marketization indicator system,the development level of market economy is the highest,while the development of market-oriented legal environment the most sluggish.The depressed state fits the status of social and economic development in China,which verifies that the design of the indicator system can reflect the current reality of the development.Moreover,the ranking of marketization level among the four major economic sectors remains unchanged over the years,which are the eastern,central,northeast and western regions by descending order.The spatial differentiation characteristics are consistent between marketization and economic development.Thus,marketization still plays an important role in explaining Chinese economic development.Again,through measuring the effects of marketization levels on regional economic development empirically,we find that the marketization level of regional economic development plays a significant role in promoting regional economic development.Moreover,in the result of growth accounting of the entire sample,the contribution rate of the overall regional marketization level to regional economic development reaches 26.04 percent,which has played a key role in promoting the regional economic development.With the test of the threshold panel model,it’s further found that during the process of market construction and economic development in all regions of our country,the mechanisms of marketization level on regional economic development has experienced two turns.The relative marketization level values are 3.640 and 5.417 respectively in the two turning points,which form the corresponding three influence intervals.In these intervals,the positive impact of the marketization level on regional economic development shows a progressive trend with gradual enhancement of the marketization level intervals,and the increasing impact of marketization process on economic development will be strengthened with the increase of market level.As a result,the solution in the New Normal is to continue deepening the reform of market system.We also find,from the analysis,that the marketization level is the main driver of total factor productivity improvement,having an important role in promoting the economic growth pattern transformation and improving the quality of economic development.Meanwhile,the effects of the marketization level on regional economic development present the differences of spatial distribution.With the improvement of market construction and the passage of time,especially in 2008 and 2013,the relative influences of market level on economic development in less developed regions are gradually higher than developed regions,this is a new phenomenon found in grouped regional samples.Finally,we believe that promoting the market construction is the core driving force to achieve a harmonious,stable and sustainable development of our country,which is also the key infrastructure of economic growth pattern transformation,improving the economic development quality and moving towards balanced development phase,and is an important institution guarantee to release supply side institutional reform under the background of the New Normal.Therefore,it has become a priority in future regional economic development to deepen economic institution reform,strengthen the construction market and enhance the market level.There are also specific innovations in this paper.Firstly,the market indicator system with certain advanced characteristics is designed to reflect the new characteristics of marketization process and describe the new situation of the practical development in this paper.It should be established as far as possible to reflect the social economic reality to select any indicators and construct the indicator system,so the marketization level indicator system should also be built with time.The basic indicators are screened and selected based on the new features of the market construction,continuous comparability and availability of data in recent years,especially for the changes of the statistical standards in previous statistical economic indicators,using data separation,consolidation,close substitutes and other methods to achieve the unification of the statistical standards.In the premise of the marketization’s meaning and significance reflected by indicators remaining the same,this paper tries to achieve continuity and comparability of market indicators at all levels and different stages among different regions in the 1997-2013 time span,which is of creativeness in the current researches on indicator systems and indicators of marketization.Secondly,it has certain advantages on research perspective and methods of model construction,internal logic and mechanism of influencing effects of market level on the regional economic development.There are lots of researches on influential factors in regional economic development.According to consensus from existing researches combined with current realities of social and economic development,based on persistence,non-accidental and importance of impacts on regional social economy,this paper builds influencing effect model of market level on the regional economic development and reaches the proper conclusions with empirical analysis,identifying and selecting the indicators that play a key or major role on regional economic development,which include market level,the level of technology improvement,human capital level,industrial structure,economic openness level,infrastructure development level and so on.In short,included in hot topics of the regional economy,it has important theoretical and practical significance to select effects of marketization on the regional economic development as research topics.It helps to supplement and improve our market economic theory and economic transition theory through building the market indicators,as well as digging out the conclusion of the study at depth,that the mechanisms of the market level at different stages on regional economic development have disparities in economic transition process.With quantifying and comparing the market level of different regions,we verified that it serves as the core and drive to promote market-oriented construction for realizing stable sustainable development,and narrowing.the regional disparities,and helping deepen the market economic reform,continuing to promote the market construction,high efficiently releasing the results of the supply side reform.