Research On China's Long-term Economic Growth Potential

Based on neoclassical economic growth theory,this paper explores China's longterm economic growth potential.According to the neo-classical economic growth theory,a country's long-term economic growth mainly depends on the improvement of TFP,so this paper firstly use Solow residual method to estimate China's TFP from 1952 to 2018,and the estimation results show that China's TFP has basically shown an upward trend since 1952.From the perspective of the contribution of various production factors to economic growth,physical capital is the main driving force of China's economic growth.However,in the recent period,the contribution of physical capital to economic growth has decreased,while the contribution of TFP to economic growth has increased.The AR autoregressive model is built to estimate each element in the economic growth model.In the process of using AR autoregression model to calculate TFP,this paper considers the influence of education,income distribution and system on TFP.According to the empirical research results,the continuous development of middle and higher education and the improvement of the system can have a positive effect on TFP,while the widening of the gap between rich and poor has a negative effect on TFP.By combining the autoregressive estimation results and the historical data of each variable,the future of each variable can be predicted.By substituting the predicted results into the economic growth model again,the future output of China can be predicted.According to the forecast,China's real per capita GDP will reach the threshold value of the world bank's high-income countries in 2029(the world bank's per capita GNI standard will be converted into per capita GDP standard),completing the leap of the middle-income trap under the absolute income method.China's per capita GDP will reach 60% of that of the us by 2041,completing the leap of the middle-income trap by the relative income method.In order to successfully overcome the middle-income trap,China should pay more attention to the improvement of total factor productivity,vigorously promote the development of education,system improvement and income distribution equity,so as to cultivate China's long-term economic growth potential and complete the transition from the middle-income stage to the high-income stage.