Marketization And Resources Misallocation In Manufacturing And Service Industries In China

Over these years,China's economy has been rapidly developing in a shocking"China Speed".However,there are many unbalanced phenomena behind it,which hinder the further development of China's economy.With China's economy entering the"new normal" and the gradual deepening of the transition,we can no longer rely on the extensive growth path by increasing resources investment.We urgently need to speed up supply-side structural reforms and improve the efficiency of resources allocation to achieve coordinated development among industries and regions.Based on the provincial panel data,this paper used the difference between marginal product of capital and labor force to reflect the resources misallocation,and measured the degree of resources misallocation between manufacturing and service industries from 1998 to 2015,conducted a comparative analysis of the eastern region,the central region and the western region respectively,and analyzed the impact of the marketization level on resources misallocation between manufacturing and service industries.The following is my research conclusion.From the time point of view,the degree of capital misallocation between manufacturing and service industries presented an inverted U-shaped change,which first increased and then decreased,and the trends in these regions were close.The performance of labor misallocation among manufacturing and service industries is different in various regions.In the eastern region it dropped first and then rised and fluctuated continuously,showing a slight sign of improvement in recent years.The central region and the western region both showed a wave-like rise,and labor misallocation in the western region gradually improved after 2008.From the comparison of different regions.resources allocation in the eastern region is better than that in the middle region,and resources misallocation is the worst in the west region.This is consistent with the economic development in these regions.The regression analysis of resources misallocation,the marketization level and other relevant factors shows that the growth of marketization can improve the efficiency of resources allocation.In addition,improving regional infrastructure,expanding openness to the outside world and optimizing industrial structure all contribute to reducing the resources misalloation.Finally,based on the above conclusions,I put forward some policy recommendations such as promoting the coordinated development of manufacturing and service industries,strengthening inter-regional interaction,reducing the obstacles of resources flow and promoting market-oriented reform.