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Factor Inputs And Total Factor Productivity And The Economic Growth Momentum In China

Posted on:2007-04-19Degree:DoctorType:Dissertation
Country:ChinaCandidate:J XiongFull Text:PDF
GTID:1119360218462506Subject:Political economy
Abstract/Summary:PDF Full Text Request
It is a significant issue highly concerned by economists and policy makers whether China's economy will maintain the growth speed with sustainable rate after its 20-year rapid growth. The essence of the problem is what kind of motive power is driving China's economic growth and how great this power is, which is the core of this article. The aim of this article, which proceeds from factor input and total factor productivity, is to build a theoretical framework about the motive power of economic growth which also severs as a basis for people to attach importance to the fundamental realities of China and the characteristics at the period of dual transition, and analyze the demand and supply restrictions, urbanization and the roles WTO and government play in China's economic growth, by combining some analytical methods, such as standardized analysis and empirical analysis, qualitative analysis and quantitative analysis, logical analysis and historical analysis. By absorbing the basic theoretical idea of endogenous growth, the article divides the factors of production into four parts as material capital, simple workforce, human resource and intellectual capital which are useful for the progress of economy. And the expansion of Solow model made by the article also results in an analytical model of economic growth with broad applicability. The basic ideas expressed by this model are the direct motive power of economic growth comes from the increase of these four factors and total factor productivity; so far as China, an undeveloped country, is concerned, the growth of intellectual capital input is not only a part of the growth of all factors input, its corresponding increase of innovation results are also major sources of technological progress. The growth of total factor productivity comes from three parts, that is, improvement of the distribution of resources, scale-saving and progress of knowledge. The interaction within the four factor inputs and between factor inputs and total factor productivity also acts as an important foundation for understanding and analyzing China's economic growth. In a fairly long period of time, China's economic growth may be restricted by insufficient demand that is mainly resulted from some long-term factors such as excessive gap of income distribution and imperfect social security system. As a result, the growth of factor input and total factor productivity will be hindered to a certain degree. Because of the imperfect factor market, the inadequate investment by government, the imperfect educational system and technological system, China's economic growth is yet constrained by insufficient supply of factors. The sustained rapid promotion of urbanization and thorough development of opening since China's admission to WTO act as a strong stimulus to alleviate the restriction of supply and demand in economic growth and accelerate the growth of factor input and total factor productivity. Therefore, urbanization and admission to WTO are two important engines of China's economic growth in the future. In order to give full play to its great functions in economic growth while focusing on promoting the growth of factor input and total factor productivity, the government should orient its own functions accurately, deal with the relations between government and market correctly, form the motive power for economic growth through the formulation and implementation of strongly matching policies and regulations. In order to achieve all above, it is very necessary for the government to carry on its own reforms.In addition to the introduction, The full text is divided into six chapters. Introduction describes the background and significance of the study, and an overview of relevant studies both here and abroad, and a brief summary of this research methods, the basic ideas and innovations.The first chapter is based on theoretical analysis. First, discriminate and define the basic concepts such as economic growth, factors of production, total factor productivity and economic growth factors; Then, in terms of factor inputs and total factor productivity, assessing a representative growth theory such as Adam Smith's economic growth theory, H-D model, neo-classical growth theory, endogenous growth theory; Finally, absorbing ideas on the basis of the outcome of endogenous growth theory, Solow model has expanded. In the research of expansion models, I analysing the three assumptions of Solow model one by one , and found these conditions while has to be used to economic growth accounting is necessary, but revealing the ceberation of direct motivation of economic growth motivation, is not necessary, therefore these three assumptions can relax. In addition, the factors of production in Solow model will has increased two to four, namely, increased human capital and intellectual capital, and defined each factor as stock. Then, after mathematical thinking, to produce a strongly comprehensive and applicability of economic growth factor analysis models.Second chapter is about general analysis of relationships between technical, factor inputs and total factor productivity. This chapter inspected and has limited in the different meanings of "the technology", and has carried on the classification in the economic technology advancement; Analyzed and discussed the difference and the relation between total factor productivity and the technical, and the mutual influence between four factor inputs as well as the influence of the factor inputs to total factor productivity. The technology has technology study on the technology, the sense of input-output in the technology and the economic generalized technical three stratification planes, only the sense of input-output in the technology advancement rate equate to the growth of total factor productivity. Between each kind of factor production exists mutually affects, also these factor inputs also have the important influence to total factor productivity, these relations are the important foundation to understanding and analysising economy growth mechanism.In the application of the theoretical model of the first chapter and the basic concepts of the second chapter, the third chapter is based on empirical research about the existence to our country's demand insufficient and its principal aspect, the influence of the demand insufficient to the factor input and total factor productivity, income distribution gap is too wide and constraining economic growth in the demand for long-term. The research indicated that, after 1990s, Chinese existence total quantity demand insufficient, also the demand insufficient principal aspect is the insufficient of consume demand; The reasons for the insufficient of consume demand except such fators as imperfect social security systems mainly because the income distribution gap is to wide; As has been wide gap in income distribution in the short term is difficult to narrow the moderate scope, the insufficient demand because of the insufficient consumer demand may exsits in a long time; prolonged insufficient demand will not only hinder the foctor input in general, but also is bad for the growth of total factor productivity.The fouth chapter first to explore the three dimensions of insufficient supply and their interrelationships, and then analysis more comprehensives about the presence of factors of its inadequate supply and the factor inputs and the growth of total factor productivity. The insufficient supply including inadequate supply of products, factors and systems three levels insufficient supply, and their exsit close contact, from constraining economic growth perspective, the most direct and core aspect is the factor insufficient supply, but the system insufficient supply is not the most profound causes; Despite long-standing, the China's high savings rate in the world rare, but the government in the document stressed the importance of the strategy of rejuvenating the country through science, but in addition to simple labor supply adequate, the physical capital, human capital and knowledge capital exist insufficient supply, the reasons for leading to the three factors of the supply shortage can be summarized mainly institutional; Each inadequate supply of factor have varying degrees of obstruction role to the other factor inputs and the growth of total factor productivity, especially inadequate supply of human capital will have a wide-ranging and serious constraints on economic growth.The fifth chapter gives view of urbanization and joining the WTO are the two engines to make China's economy growth, and a more detailed study of China's urbanization lag and the presence of enormous urbanization development space, join the WTO has functions to promote import and export and to attract foreign investment and economic reform. Both from the "volume" or the "quality", China's urbanization are all lagging behind, especially from the urbanization level, compared with the rest of world countries with similar levels in per capita income, China's urbanization is a more serious lag, and from the general law of view, China has entered the rapid urbanization of the stage of development and therefore, so long as the urbanization strategy is correct, China will experience the quite long time of the rapid urbanization ; China joins WTO to take as a long-term process, already moreover also has important function to promote the China's import and export, and to attract foreign investment as well as the institutional reform; The urbanization and joins the WTO could eliminate or reduce the demand restriction and the supplies restriction of the economy growth, then has widespread and formidable propelling force to the factor inputs and total factor productivity ,therefore, the urbanization and WTO will become the engine of the Chinese economy growth.At the beginning of the sixth chapter, the author discusses points as following: reasons that government intervenes the economy during the course of economic development, the basic principle of orientation of government functions, the particularities of China's economic society and orientation of government functions, guideline and focus of government for economic growth. On the basis of the conclusions drawn from the former chapters, policies and measures for promoting the economic growth has been put forward. At the end of this chapter, the necessities of the reform of government are analyzed. The essential reason for government to intervene economy is that there are many inherent flaws in market mechanism and the government intervention owns the superiorities which surpass the market itself. Because of "malfunctions" existing in market, the government must give moderate intervention to economy. To go by China's particularities, compared with other national governments which practice general market economy, the functions of Chinese government is wider. Thus Chinese government should play a more constructive role in China's economic growth. Also, it will be the duty of Chinese government to take effective matching countermeasures to alleviate the restrictions of supply and demand in China's economic growth and construct urbanization in the real sense. It is necessary for government to speed up to practice its own reform so that it will have the abilities to play its parts to the full.
Keywords/Search Tags:factor input, TFP, China's economic growth
PDF Full Text Request
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