Research On The Influence Of Capital Allocation Distortion On China's Industrial Structure Optimization

In the four decades since the reform and opening up,China's social productivity has been greatly developed--the supply shortage of most industries has been fundamentally improved.On this basis,China's product market has basically completed the market-oriented reform,market supply and demand to pricing has become the norm of the product market.However,in China's factor market,the role of the market in the allocation of factor resources has not been fully played.Especially in the very critical capital factor market,administrative intervention,interest rate control,"ownership discrimination","scale discrimination" and other tangible or intangible factors hinder the market determining mechanism of capital price,making the actual use price of capital deviate from its opportunity cost for a long time,thus resulting in the distortion of capital allocation.From the actual situation of our country,most of the capital allocation distortion belongs to the negative distortion,that is,the use price of capital is lower than its own opportunity cost.Such capital allocation distortions,although in the short term is to reduce the investment cost and promote the social overall economic growth,but also makes the capital elements of the configuration is not fully,timely,accurately to adapt to changes in the social overall supply and demand,between different sectors in the development of collaborative is abate,and hinder the optimization and upgrading of industrial structure.Based on the above considerations,this paper takes the impact of capital allocation distortion on the optimization of China's industrial structure as the starting point of the thesis,in order to conduct in-depth research on this issue.At the beginning of the research,this paper firstly makes a theoretical analysis on the concept definition,cause explanation and present situation of capital allocation distortion in China.From the perspective of historical factors and institutional factors,this paper makes an in-depth analysis of the capital allocation distortion in China by using Bhagwati's factor allocation distortion theory.Then,from the three angles of efficiency,rationalization andadvancement of industrial structure,this paper demonstrates the influence path and result of capital allocation distortion on the optimization of industrial structure in China.Finally,based on the inter-provincial panel data of 29 provinces in China from 2000 to 2017,this paper makes an empirical study on the influence paths obtained from the theoretical analysis.The results show that the distortion of capital allocation in China has a positive effect on the efficiency of the industrial structure,but a negative effect on the rationalization and upgrading of the industrial structure.The research conclusions of eastern,middle and western regions are basically consistent with this.According to the relevant research results,this paper proposes the following policy Suggestions :(1)accelerate the reform of interest rate liberalization and improve the allocation mechanism of capital factor market;(2)accelerate the transformation of government functions and reduce administrative barriers in the capital market;(3)deepen supply-side structural reform and effectively cut overcapacity;(4)optimize the structure of labor and capital distribution and increase the effective demand of society;(5)increase investment in scientific and technological research and development,and actively promote entrepreneurship and innovation.