Study On Total Factor Productivity Of China’s Industry

As the leading industry of the national economy, Chinese industry has seen asignificant development in the aspects of scale and quality in recent years. Thedevelopment of industry is playing a vital role in boosting economic growth by greatcontribution to GDP compared to other industry. The pattern of industry growth of highinput has already shown inefficiently with more and more side effects. Some measuresmust be taken to alter current trend.The paper gives a thorough study to figure out the TFP of overall industry andsegments.Specifically, by treating each industrial sector as a decision-making unit（36sectors in all）,using industrial added value as output,average balance of net fixedassets and number of employees by the end of the year as input. The paper thoroughlystudied industry TFP during1993to2011by DEA. The main conclusions: First, theoverall TFP shows a upward trend with several fluctuates. Technical efficiency changewas the main factor of TFP growth before2001. However， technology change becamethe main factor after2001. Secondly, most sectors that are with high technology changegrowth rate belong to high-tech sectors which also obtained high FDI or are in fiercecompetition. Thirdly, technical efficiency change is mainly in the process of declinewhich decreases total factor productivity. These sectors that are show poor technologychange growth rate seems to have higher technical efficiency change than those withhigh ones. Besides, pure technical efficiency sees a slight growth. Sectors with highcompetition tend to have high pure technical efficiency. Scale efficiency fluctuates inthis period. Scale efficiencies of traditional heavy industries show a downward trend. Inthe end of the paper, suggestions are offered from aspects of technology, innovation,investment.