The Empirical Study On The Industrial Structure Adjustment And Business Cycle

The realistic economic always fluctuates back and forth surrounding the stable trend of itself. In other words, the economic growth is realized through the economic expansion and contraction. It is so called"Business Cycle". Under the condition of certain technique, certain industrial structure will be shaping up through specialization and division of labor in the economy. The economic development will promote the industrial structure adjustment. The industrial structure adjustment will also have a certain impact on the economic development.This text makes a positive research on the industrial structure adjustment and business cycle. We use the ratio of industry production value to GDP as the index for the industrial structure adjustment. This text divides the business cycle in China by means of valley—valley method according to the real GDP growth rate.Chapter 1 introduces the research made by domestic and international scholars about the business cycle and the relation between industrial structure and economic growth .S.Kuznets has made the conclusion that Per-capita national income change is the reason for the industrial structure change. H.Chenery has made the argument about the relation between economic structure and economic growth and he states that"The economic growth progress of the developing country can be comprehended as a part of comprehensive transformation of the economic structure. This interdependence relation between the economic growth and the structural transformation is expressed in two aspects: Changes in the structure of domestic demand and production arise from revenue growth; instead, the increase in the investment rate and the total re-allocation of labor resources would promote economic growth". There are many domestic scholars who have also made the argument about the relation between industrial structure and economic growth, such as"Modern economic growth is essential structure-oriented growth. That is to say, the industrial structure adjustment is the core of the economic growth (Hongqing, Rong, 2002)";"The critical problem which influences the economic growth is the structure problem but not the total amount problem (Kesha, Guo, 1999)". There are many domestic scholars who have also made the research about the economic cycle, such as,"The essential reason for the economic cycle lies in the basic contradiction of the socialism society that the produce of the society can not satisfy the large people's increasing need of material and culture .The indirect reason then lies in the system aspect that the contradiction between the excessive intervention of the multi—government organization and low efficiency of the person and corporation","The growth of the demand in advance is the main reason for the business cycle".Chapter 2 introduces the basic theories of the economic cycle and the factors influencing the economic cycle. Shucheng Liu, a famous economist in our country summarizes and classifies the factors influencing the economic cycle. These factors include economic factor, policy factor, political factor, psychology factor, technique factor, nature factor, population factor and international factor and so on. Many other domestic scholars have also explained our business cycle such as the social basic contradiction theory, two kinds of mechanism contradiction theory, the benefit install and resource install contradiction theory, the long-term strategy and short-term factor contradiction theory, the insufficiency in agriculture theory, investment promotion theory, the impulsion of the society planner theory, soft stipulation in competition theory, synthetical factor theory, the system factor theory and the cycle fission theory. According to how it comes into being, there are two parts of the business cycle. One is endogenetic factor and the other is exogenous factor. Exogenous factors will break the stable situation of the economy and push economy to grow. Endogenetic factors will push economy to be stable. Generally speaking, exogenous factors mainly include the macroscopic economic policy of the government, consumer hobby, consume structure, consume mode, the population, the war, the local market and so on. The macroscopic economic policy of the government is the most important factor among them. Endogenetic factors mainly include the economic scale, industrial structure, market structure, population structure and demand structure and so on.Chapter 3 analysis the relation between industrial structure adjustment and the business cycle .We analyze the relation between the GDP growth and the growth of three industries. When other industries'growth rate is constant, the first industry growth rate increases 1% each time, the GDP growth rate will increase 0.17%, when other industries'growth rate is constant, the second industry growth rate increases 1% each time, the GDP growth the rate will increase 0.47%, when other industries'growth rate is constant, the third industry growth rate increases 1% each time, the GDP growth rate will increase 0.33%. By means of the valley—valley method, we get the business cycle and three industries business cycle of our country and analyze their relation. When the economy is getting into prosperity or hot, the first industry will be conducive to restrain economic overheating .But the second industry will promote economy to further prosperity. When the economy is getting into depression, the first industry will aggravate the economy to further depression. But the third industry will restrain economy to further recession. We should balance the ratio between three industries and the speed of development, optimizing industrial structure. We should vigorously develop the third industry currently. Because the examples of the developed countries explain that when the proportion of the first industry descends; the proportion of the second industry descends, the proportion of the third industry ascends to a certain degree, the whole economy will be getting into the stable situation. However, when we vigorously develop the third industry, we are not blind to increase the size of the third industry.