Study On Technical Efficiency Of China's Steel Industry

As the pillar industry in national economy,the steel industry plays an irreplaceable role in the economic construction and social stability.But the steel industry is also criticized for its over-capacity of production and extensive increase method.Therefore this article explores the steel industry from the standpoint of efficiency,analyzing the change of technical efficiency and regional difference in China since 1985.The frame is as follows:the first part is introduction,listing background and significance;the second part is the analysis of industry,mainly about the general situation and impact factors of technical efficiency;the third part is empirical study,applying the panel data contains 28 provinces during the year of 1985 to 2006 and Frontier4.1 software,then observe the technical efficiency of each province for every year and the impact factor of technical efficiency,ending up with the decomposition of total factor productivity(TFP);the last part contains conclusion and policy proposal which is according to the result of the empirical study,as well as the shortage and the further research area.The innovation of this article contains:First,with the sample of provinces,the method of exploring for technical efficiency is stochastic frontier analysis,not the widely used method of nonparametric.Second,after getting the each province technical efficiency for every year,I continued to measure the contribution of technical efficiency change rate to the TFP variance ratio and also compare the difference among regions.The shortage lies in:the distribution of the technical inefficiency is assumed before and the affect factors of technical inefficiency are too intricate.In this article,we cannot get more aspects of influence.