Factor Distortion And Industry TFP In Guangxi

Guangxi becomes economic strategy point in West-South Region, and its industry importance is enhanced in regional economy, while the mismatch in factor or production structure is really obvious. For Western Development or regional economic coordination, the research on industry factor distortion and TFP becomes much more important. The factor distortion, caused by institution in developing region, is the frontier of Develop Economics, however, the research on Guangxi, the typical developing region, actually fails to draw enough attention.This research based on two part, quantification and empirical analysis. Input-output whole-caliber panel data is estimated of Guangxi industrial sub-industries and sectors from 1993 to 2012. This quantification shows that the state sector hold 50% capital, but its value added decrease to 20% from 50%, and employment to 5.9% from 50%. And the empirical analysis applies Brandt, Tombe and Zhu model and then synergy effect of sub-industries distortion and sectors distortion is added to it.The further finding implies:1) factors are blocked to be allocated to high TFP industry or sector, because the state sector TFP is low comparatively; 2) Aggregate TFP loss 50.7% and its growth loss 3.10% with the aggregate distortion; 3) Within-industries and sectors distortion are mainly effected by the capital distortion, which increases sharply and takes more effect on within-sectors distortion.4) Meanwhile the labor distortion is stable and mainly effects on within-industries distortion.The reason is concluded:1) government pays more attention on investment and authorizes more power on state sector; 2) some policies such as staff cutting and IPO lead to low efficiency rather than to improving efficiency; 3) control and credit information asymmetry obstruct the direct or indirect financing channel; 4) labor information asymmetry and problems in employment institution or vocational education actually block labor flow across industries or sectaries. At last, the institution suggestion is putted forward in terms of policy, ownership, capital and labor.