Use Time-varying Production Function To Estimate The Labor Factors Contributing To Output Of Jilin Province

Labor is the source of economic growth. Today China’s economic growth is becoming to"intensive" that makes economic progress by improving productivity and more conducive tosustainable economic development. The key of the difference between "intensive" and"extensive" economic growth is the estimation results of factor productivity level. Laborproductivity is the basic elements of productivity, measured on the labor productivity canobserve not only the path to the labor contribution to output, also can carry on the simpledescription to the sustainability of economic growth.The main content is divided into normative analysis and empirical analysis. In thenormative analysis I will review the theory and literatures of variables in my thesis. The mainvariables included: labor productivity, capital productivity, total factor productivity andtime-varying production function. In the empirical analysis, I will use the dates from1952to2011of Jilin province. At first, I will analysis of single factor productivity including laborproductivity and capital productivity. Then I will estimate the productivity of labor and capitalbased on time-varying elasticity production function.In this paper, I will use simple linear regression model to estimate single factor’sproductivity and choose the model of time-varying elasticity production function to estimatethe TFP to analyze the output elasticity of labor factor in Jilin Province. Then my paper canget the following conclusions: In the part of single analysis, labor productivity in a risingtrend, this trend is particularly evident in1996; capital productivity is fluctuations before1997, and then it is in a downward trend after1997. In the part of total factor productivityanalysis based on time-varying function, the output elasticity of labor is from0.231in1952to0.375in2011; the output elasticity of capital is from0.318in1952to0.500in2011.Thecontributing to output of capital is higher than the contribution to output of labor and thetwo elements of the output elasticity continuously rise since1952.The utilization of resourcesin Jilin is increasingly high, and it accounts for that the economic development of JilinProvince is sustainable.