The Solow Remainder Analysis Of China Economic Growth

Solow remainder can measure the production efficiency of one producer in a certain period,and it is an important factor for the development of economic.Since the reform and opening up which is began in 1978,Chinese economic reform has made excellent achievements,and the economic growth rate and lasted time of China is unprecedented in the history of world economic development.But under the influence of the Asian financial crisis in 1997,some economists take into account the growth efficiency of China economic.Studies show that the growth shows extensive mode of production and the contribution of Thoreau remainder to economic growth is low which is not high enough to support the growth of the economy,Chinese economic growth is mainly contributed by the factors of production.Another part of the studies show that the quality of Chinese economic growth has made an great improvement,and the contribution rate is rising.On this background,this paper makes an research about the method of Solow remainder,make an empirical analysis of the Solow remainder's contribution to economic growth in China,calculate the Solow remainder,labor and capital's contribution individually,and using principal components analysis to find out the main factors from technological innovation,industrial structure,human capital,urbanization level and foreign trade.It can provide a theoretical basis for the smooth operation of the economy.The results show that: first of all,the average of China's Solow remainder from 1978 to 2015 is 3.272%,and its contribution to economic growth is 26.382%.In currently,the economic growth of China mainly depends on capital and labor investment,but the Solow remainder gradually increase the contribution to economic growth.Secondly,the most important element for Solow remainder rising is technology innovation.The fund of technology development can make up Solow remainder at the 9.7% level,the domestic purchase funds could explain the changes in the 9.6% level,and the digestion and absorption of funds can make up of it at 9.5% level.Thirdly,human capital is the second factor which can explain the change of Solow remainder,and it can make up Solow remainder changes at the level of 9.3%.Finally,the level of urbanization and foreign trade also have important influence of Solow remainder change.According to the results of empirical research,it puts forward a series of thoughts and countermeasures.In order to increase the Solow remainder and make sure the high-speed economic growth,it must speed up technological innovation,which is very important to improve the capability of independent innovation,and strengthen the key competitiveness of science and technology.Technological innovation also is a key factor to improve the Solow remainder.Secondly,it is necessary to increase the educational investment,strengthen labor training,improve the quality of workers,and then improve the quality of human capital.Thirdly,to increase the degree of opening to the outside world,improve the structure of foreign trade,and make better use of external resources and the environment.Fourthly,speed up the reform of marketization,increase the ratio of urban population,expand the scope and intensity of market,and to insure the fundamental role of market in the allocation of resources.Finally,accelerate the adjustment of industrial structure,promote the optimization and upgrading of industrial structure,encourage the development of the high-tech industry and the third industry,and make it to lead the development of economic.