Research On Investment And Economic Growth Pattern Of Guangdong

Guangdong economy has been growing rapidly for nearly three decades since the Open and Reform policy was implemented, which is a remarkable success not only among all Chinese provinces but on the range of the world as well. This paper first analyzes the growth pattern of Guangdong economy, and points out the main driving force and its characteristics. In this section, this study applies the Growth Accounting method of Solow Model to the data from 1978 to 2005, and draws conclusion that the most important factor contributing to economic growth of Guangdong has been continual and tremendous capital input, while Total Factor Productivity plays a minor role through the process.This paper then makes analysis on how to improve capital input so as to transform the growth pattern of Guangdong economy. Source of capital input is the Total Saving, classified as Domestic Saving and Foreign Saving, among which FDI and private enterprises' investment are the key factors improving Guangdong's economic growth pattern. This study analyzes how to make the growth pattern more efficiency-driven from the perspective of saving-financing-investing process, and comes to conclusion that FDI should be introduced based on a strategic plan and private enterprises should be given more access to financial resources, which help to upgrade the industry structure and transform the growth pattern from input-driven to efficiency-driven.