Factor Substitution,Capital Deepening And Dynamic Evolution Mechanism Of Productivity In Service Industry

With the rapid economic growth,the contributions ratio of service industry to economy stays growth,the service industry is becoming increasingly more important to the development of our national economy.The lack of momentum and the difficulty of sustaining are emerging with the economic downward pressure has been increasing and its transmission to the service industry with the rise of labor price.In order to reduce the difficulty from downward track of service industry' economic growth to structural adjustment and growth stabilization,researching on the quality of service economic growth becomes more importantly and urgently.Therefore,this paper focuses on the core variable-productivity in service industry,which represents the quality of economy growth.It aims to study the mechanism of relative factor prices in factor substitution and capital deepening,and reveal the dynamic evolution mechanism of service productivity.The research of factor substitution,capital deepening and dynamic evolution mechanism of productivity involve many economic problems,which includes economic growth,labor price,interest rate,manufacturing cost and technological progress.In order to thorough analysis this complex economic problem,it is chosen productivity in service industry as the research object in the context of rising labor prices,and built a research framework through a large number of related literatures at home and abroad build a theoretical foundation from theory of macroeconomic growth,theory of microscopic pricing,theory of manufacturer's production cost and theory of labor productivity.Begin the work from the change of total factor productivity as a standard of service industry' quality.The research studies factor substitution,capital deepening and dynamic evolution mechanism of service industry's productivity through a variety of microeconometric methods.It will reveal the transformation from factor-driven into productivity-driven mode in service industry and a critical path of the proceeding of a moderately prosperous society in all respects.In this research,it could analyze the problem as two aspects: stage development characteristics and region features.On the one hand,this paper researches the characteristic of factor substitution,capital deepening and mechanism of service industry's productivity follow the time lead.On the other hand,it compares the difference about factor substitution,capital deepening and mechanism of service industry's productivity among areas.To be more specific,the main contents of this paper are proposed as follows.Firstly,it estimates the provincial capital stock of service industry to lay the foundation and describes the characteristic of capital deepening through capital and labor ratio.Based on comparing and analyzing the measuring method and indicator,through the analysis on the relationship between depreciation and price in Jorgenson's durable goods production model under different depreciation pattern,we calculate depreciation decrease as geometrically and capital stock on PIM,and then examine the reliability of capital stock,analysis the transitional and regional features of capital deepening in service industry.The result shows that the depreciation rate of fixed assets in service industry differs significantly between different years and regions because of the difference investment structure of fixed assets.It finds that it is reliable to estimate capital stock by depreciation decrease as geometrically.It appears a quickened features of capital deepening.The trend that difference enlarges of capital deepening among areas will influence the development of service industry.Secondly,it studies the dynamic evolution mechanism of service productivity under the framework of productivity theory,which is based on variable scale compensation characteristics.It measures TFP of services industry by DEA-Malmquist,analyze the changing characteristic of TFP and single factor productivity,builds panel data fixed effects model,and estimates capital-output elasticity and labor-output elasticity.Explain changing characteristic of TFP through the changing of single factor productivity.It shows that the economic growth of China's service industry is drived by capital.The rise of labor factor output rate with low labor-output elasticity could infect TFP growth positively.However,this influence has been offset by the effects from the decline of capital factor output rate with high capital-output elasticity,which leads TFP decrease slightly.The economic growth of service industry shows difference among regions,the driving force has transformed from factor to TFP as intensive in east area,while it is still drived by factor as extensive in middle and west areas.In order to increase the quality of economic growth and realize transformation of driving pattern,it should put off the decline of capital factor output rate and enhance labor factor output rate.Thirdly,it estimates the elasticity of substitution,research the positivity of manufacturer use capital and explains the reason of capital deepening according to the factor substitution,and suggest to put off the decline of capital factor output rate through enhance capital allocation efficiency.Panel data fixed effect regression models have been applied to estimate the elasticity of substitution,which is based on the VES production function and implicit function caused by demand.Furthermore,it utilizes cross-sectional data with WLS empirical method to test the capital allocation efficiency based on capital allocation efficiency model.In order to analyze impacts on growth of capital stock and capital deepening which caused by relative factor prices,it employs FGLS,MLE and GMM models respectively to estimate random effects and dynamic process.The results show that the relative factor price accelerates the course of factor substitution,the rise of elasticity of factor substitution show that the positivity of manufacturer use capital being raised.In recent years,the capital allocation efficiency of services has improved overall.The change of relative factor prices promotes the growth of capital stock in service industry significantly and accelerates the course of capital deepening.However,the shortage of consumer demand in the middle region has caused the inefficiency of capital allocation.Therefore,the investment has great profits in west region due to the low elasticity of factor substitution.Capital allocation efficiency will increase and capital factor output rate will decline by expanding demand for market consumption in middle region.Finally,it tests the influence of relative factor price and capital deepening on the growth of labor productivity,and explores the transformation path of growth driven model in service industry.Through testing applicability to China's service industry of Ekelund's theory by Granger test,it improves there exists bidirectional causality between increasing labor productivity and wage growth.It use panel stata test the interaction influence between labor productivity and wage at different times through cointegration model and error correction model,and build panel data fixed effect model based on VES production function to find the driving source of the growth of labor production in service industry.The result shows that,there is an interaction influence between labor productivity and wage in service industry.The growth of labor productivity and wage is synchronous in east and west region,there is self correcting mechanism in the two variables.Invalid in middle region should has negative influence on labor productivity rising.Capital deepening has significant facilitation on the increase of labor productivity in service industry.Thefore,it should pay attention to the increase of wage without increasing labor productivity and the decline of the effect degree in service industry.The key point to realize transformation of driving pattern in service industry is to improve labor productivity by expanding demand of market consumption in middle region.