Openness And Economic Growth In Shenzhen

In the past 30 years,Shenzhen grew from a small fishing village into an international metropolis with rapid economic growth.Shenzhen have made great progress with the special economic zones,which is more opening to the outside compared with the other cities in China.2016,Shenzhen's total GDP reached 1,940 billion yuan,ranked fourth in the country.As a export-oriented economy,Shenzhen's openness has laid the foundation for economic development,however,which role has it played,how did it drive economic growth,which kind of connection was it with economic growth,which not only can make a reasonable forecast and planning proposals for further development of Shenzhen at present,but also be useful in locating the Free Trade Zone and for the mainland city in referring to the great significance and successful experience of Shenzhen.Therefore,this paper puts aside the previous research and analysis of the openness and development with national level,and uses the Shenzhen data for empirical analysis.The paper summarizing the past openness theory,especially the concept of the level of openness and openness degree,laied the foundation for the later empirical analysis,and then summed up the mechanism of openness to promote economic growth by theoretical analysis.Then,through the analysis of the current situation of economic development since the establishment of the Shenzhen Special Economic Zone,which combined the perspective of technological progress and C-D production function,this paper reveals the connection between openness and economic growth.In the model,instead of using Keynes national income model,this paper expand the C-D production function,constructing the connection between openness degree and technological progress.Because of Shenzhen's data is not stable,multivariate cointegration method has been used to four variables in the econometric model,the openness degree,labor,capital stock and GDP in the regression estimates,overall grasping the connection in the variables,and drawing a conclusion that the openness will decline gradually with the economic growth in the developing country.The results of this study showed that: Shenzhen is an export-oriented economy,which is dependent on international trade.Shenzhen was dependent on processing industry in the beginning,and now mainly rely on high-tech industry.The connection between openness and economic growth in Shenzhen is “U”-shaped curve,which lies in the bottom of the U curve,showing that Shenzhen is in the transformation and upgrading of the economic structure,high-tech industries,advanced manufacturing industry and the rise of the cultural and creative industries have not yet fully formed the international competitiveness.The traditional foreign trade declined rapidly and the new foreign trade is still in the early stages of development.Even though the effect of the foreign investment is very significant,the dependence of the international trade decreases gradually with the economic and technology growth,partly because of economic growth inducing the dependence on the foreign investment and the development of the technology weakening the dependence on the foreign technology.International investment is of great significance to upgrade the structure of the developing economy.But with the development of Shenzhen's foreign investment and transnational enterprises in Shenzhen,we found that Shenzhen enterprises have not formed the international competitiveness,and are lack of international investment experience,which need the government support,the guidance of the theory and experience accumulation;labor force is an important factor of production and has a promoting effect on the economic growth of Shenzhen,showing a negative correlation cointegration relationship,which is mainly due to the excessive supply of Shenzhen labor and inefficient supply,which making both the labor shortage and recruitment problem.According to the Solow model of economic growth,technological progress and human capital determines the long-term economic growth,and the human capital for technological progress will play an increasingly important role,so human capital will be the basis for future economic growth potential,and Shenzhen should pay attention to the human capital construction.