| How microeconomic shocks are amplified and propagated through the economy to cause sizable fluctuations is at the heart of much macroeconomic research.As the updating of empirical methods and the transformation of economic situation,the research on micro-impact has been advancing continuously with the development of modeling technology since 1970s.The macroeconomic importance of this idea was downplayed by Lucas's(1977)famous essay on business cycles on the basis of the argument that if shocks that hit firms or disaggregated sectors are idiosyncratic,they would then wash out when we aggregate across these units and look at macroeconomic fluctuations due to a law of large numbers-type argument.The real economic cycle model is used by Kydland and Prescott(1982)to demonstrate that "small" exogenous technology shocks affect output through investment and capital accumulation.Recently,Acemoglu et al.(2012,2016,2017 etc.)describe the transmission mechanism of micro shocks to an industry under the general equilibrium framework with input-output network,and prove that the s input-output network effect is an important explanation to economic fluctuations caused by micro shocks.And the structural effect of micro sectorial shocks has special significance for the current Chinese economy.While trade frictions caused by changes in the international environment and economic growth threatened by the middle-income trap,the deep integration of the new generation of information technology and manufacturing industry has led to global industrial changes.Such complex economic situation under the new normal is challenging the Chinese government.The massive overcapacity that must be addressed means that distortions in the industrial structure have become a constraint on development;the high leverage of the macro-economy means limitation of fiscal expansion,and the trade war brings new uncertainties to the Chinese economy.In the face of all this,only the optimization of the industrial structure based on the development of Chinese manufacturing industry with independent intellectual property rights can help China's economy move forward.Therefore,how to support the development of the target industry more effectively and finally complete the optimization and upgrading of the industry has become an urgent theoretical and policy issue to be studied.Due to the limitations of analytical tools,at present there are two defects in Chinese research:one is that the research based on the reduced-form model cannot capture the structural effects of industrial policies,which will affect the accuracy of policy effect estimation.Second,structural models such as CGE and DSGE fail to clearly describe the transmission mechanism,which will lead to the lack of solid theoretical basis for the interpretation of the findings.In view of the above problems,the solution is to refer to the recent research on micro impact by Acemoglu et al.Based on the characteristics of Chinese economy,I modify some basic hypothesizes of Acemoglu et al.(2016)and study China's industrial structure upgrading policy using general equilibrium analysis framework with input-output network.To this end,I conducted three aspects of research:In the part of theoretical research,Acemoglu et al.(2016)model was expanded from two aspects based on Chinese facts and research purposes.The transmission mechanism of supply-side shocks and demand-side shocks under more general production functions was discussed respectively,and the impact of Hsieh-Klenow form of resource allocation distortion on economic and social welfare is also discussed.When analyzing the impact of supply-side and demand-side shocks,based on the fact that China's input-output structure keeps changing,I set the production function as the CES form with volatile factor shares,and examine the impact of shocks on output as well as added value under the general equilibrium framework of three sectors which includes producers,consumers and the government.The basic conclusion is that supply shock affects output through downstream effect,upstream effect and resource redistribution effect.But added value is only affected by the latter two.Demand shock has the same effect on output and added value which is recognized as upstream effect and resource constraint effect.In the discussion of distortion shocks,I introduce resource allocation distortion into the model in the form of Hsieh-Klenow,and examine the impact of distortion shocks on output,added value as well as welfare under the framework of two-sector general equilibrium that only includes producers and consumers.The basic conclusion is that the misallocation will affect output through direct demand-side effect,indirect demand-side effect and supply-side reallocation effect.The effect on added value only includes the first two effects while the analytic formula of welfare change clearly gives the influence of welfare,but the influence size depends on the parameter value in the model.In the part of empirical study,I adopt the fixed-effect model to investigate whether the network effect of supply-side shocks represented by productivity shocks and demand-side shocks represented by fiscal spending shocks is supported by Chinese data.The empirical test uses China's industry-level input-output data and patent data.Quantitatively,the supply shock represented by productivity shock has positive downstream effect and negative redistribution effect on output.Meanwhile,the added value will also be significantly affected by the positive upstream effect and negative redistribution effect.In addition,the demand shock represented by the impact of fiscal expenditure is expansionary on the whole.In the part of applied research,I simulate the role of fiscal expenditure policy and structural tax reduction policy in the upgrading of China's industrial structure,and obtain the optimal policy combination under different policy objectives.In the process of policy simulation,I set the promotion of the position of high and new technology industry relative to the traditional "highly-polluting,energy-intensive industries" as the economic targets for the industrial upgrading.Then based on the industrial structure adjustment index I use 2012 China input-output data to evaluate the effect of the implementation of fiscal spending policy and structural tax reduction.Comparative static analysis method is adopted for the whole simulation.The result shows that the structural effect of fiscal expenditure propagates upstream only.Finally policy simulation based on the above empirical analysis suggests that the policy target should locate downstream in its own rather than the opposite sector.In addition,.0.3369RMB value added rise in hi-tech industries and 0.7234RMB value added drop in restrictive industries which sum to 1.0602RMB will happen due to 1RMB adjustment of fiscal expenditure.When taking structural tax reduction as the policy means,the target industry of structural tax reduction should have the characteristics of high added value and low proportion of private consumption,and it should be an important downstream industry supporting the industry in the input-output network without being in the downstream position of restraining the industrial chain.Due to the combined effect of private consumers' demand for products in target industries and the above-mentioned two factors affecting the effect of fiscal expenditure,the 1RMB tax reduction can bring up to 0.4262RMB industrial structure upgrading effect.The contributions of the above researches are mainly reflected as follows:first and foremost,the hypothesis of Acemoglu et al.(2016)is relaxed,and the model is extended to a more general form of volatile input-output structure,which theoretically proves that the variability of input-output structure will lead to impact on economic goals through new transmission mechanism.Then the model of Acemoglu et al.(2016)was further extended,and the distortion friction is introduced into the analysis framework in Hsieh-Klenow form to discuss the influence of distortion changes and the transmission mechanism.Secondly,empirical test is conducted on the impact conduction mechanism described by the theoretical model,and the existence of structural effect of supply shock and demand shock in China are verified for the first time.Finally,based on the theoretical model and empirical results,I demonstrate the optimal policy choice of fiscal expenditure and structural tax reduction,providing new ideas and effective evidence for the formulation of China's industrial policy. |
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