The Impact Of Structural Change On Manufacturing Productivity Under The Opening Conditions

In the 20th century, the manufacturing has brought huge economic development and market prosperity to the United States, Japan, Europe and other countries. Since the reform and opening, relative to other domestic industries, China’s manufacturing sector developed so rapidly to become a major source of economic growth. Today, china is known as the "world factory ", China’s status as a big manufacturing country has been recognized, then what is the source of such rapid growth of the Chinese manufacturing? The development of an industry can be obtained mainly in two ways: one industrial sector can improve the technical level of its own or accumulate capital to improve the overall productivity; Second, through the transfer of labor resources across sectors, that is structural change, the industrial sector can improve overall productivity; Some scholars has analyzed the source of economic growth of countries, they found that the rapid economic development entail industrial structure change, these developed countries seemed to have gone through growth-structure change, it means labor transfer from low productivity sectors to high productivity sectors, when the labor flows in the reverse direction, this will make negative effect on productivity, that is, " recession-type structure changes", but for China, the rapid development of China’s manufacturing industry has made a significant contribution, this article selected micro-level Chinese provinces manufacturing as research subjects, the origin and development of China’s manufacturing can be analyzed more accurately.This paper selected the data of China’s 30 manufacturing sectors in 2003-2010,by calculating the productivity of every province, we found there is a big difference between provinces. To the same manufacturing sector, it presented different level in different provinces. Through shift-share decomposition we can divide the productivity growth into two aspects, the first one is called the internal effect, the second one is the structural effect. The analysis revealed that the development of China’s manufacturing productivity growth comes from the internal effect mainly, the structure phenomenon bonus did not occur in China’s manufacturing sector, a common phenomenon in China is that low productivity sectors own more labor relatively, high -productivity sectors own fewer labor.In different regions, the internal effects and structural change effects on overall productivity growth’s contribution is different.Internal factor is the main contributor to improve manufacturing productivity, and the size of contribution is different in different regions, we use regression methods to measure factors which affect this size. We found the level of people living and the level of foreign direct investment significantly affect the level of the contribution of structural change factor. Through the analysis, we know that the relative advantage of cheap labor resources is coming to an end, it is necessary to upgrade the industrial structure, improve the quality of labor and guide labor move from low productivity department to high productivity sectors orderly to keep the continue development.