An Empirical Study About The Impact Of Institutional Change To The Economic Growth

Since reform and opening up, The economy of China has changed dramatically, the average economic growth rate has been more than 9%, it becomes a hot study. Look at different studies; no one can explain the phenomenon of economic development in China comprehensively. But it should not be overlooked that many new social and economic system is promoting the development of our economy in the transition period from planned economy to market economy. Therefore it is significant to study the system on the economic growth.Starting from the institutional change, it first introduces the concept and systems theories of institutional change, focusing on Marx's and North Theories of Institutional Change. Then it introduces the development of economic reform process in China comprehensively. The economic is been divided into two blocks, one is economic growth under the radical transformation and the other is economic growth under incremental reform. It is the base for the empirical research.In the empirical research of institutional Change on the Economic Growth of China, we find that system change reflects three main aspects:changes in property rights of economic entities, changes in resource allocation and overall adjustment strategy. Therefore, we use property rights indicators, targets and open economic system indicators to measure the institutional factors. For a more comprehensive study, we discuss the issue through three aspects:institutional change and national economic growth, institutional change and regional economic growth and institutional change and industrial economic growth. In the research of national economy and regional economic, in order to directly measure the three indicators on economic growth the system size, we use principal component analysis to deal with the linear of the three variables. Then we set a economic growth model which make system factor as a endogenous factor, and use principal component analysis to get a synthetic variable and make it proxy variable of system. Studies show that the three measure indicators of system have a positive impact on the national and regional economic. The system has greatly promoted the economic. In the study of the system on the economic of the industries, we use impulse response and variance decomposition for the discussion, it discovers that the three measure indicators of system have different levels of impulse response to the three industries, and the contribution of the three indicators is different for different industries.It is shown that institution change to our economic growth can not be overlooked through theoretical and empirical studies. But there are a series of problems.Reference to empirical result; it gives some suggestions in the last part of the article.