The Distortion Of Labor Price And Biased Technology Progress

As one of the sources of economic growth,technological progress is an enduring theme of the economics community.However,the existing research focuses on Hicks neutral technological progress,ignoring the bias of technological progress.The bias of technological progress determines the pattern of income distribution in the process of technological progress,and it is of great significance for in-depth understanding of the connotation and determinants of technological progress.Many scholars have calculated that China’s direction of technological progress is biased towards capital,but what factors have led to this result?The factor prices and endowments pointed out in the theory are decisive factors in inducing technological progress toward certain factors.For this reason,this article will try to analyze the bias of Chinese technological progress and its possible causes from the perspective of labor price.However,the market price of capital and labor in our country has been artificially depressed,which makes the labor price not reflect its scarcity.When factor prices are distorted,the factor endowment conditions faced by different companies will also be distorted,thus affecting the company’s biased technological progress.In addition,considering that the level of labor prices will be affected by the demand and supply levels,this paper will link international trade and market segmentation with the bias of technological progress,and try to use labor price distortion as an intermediary variable to analyze the influence of trade and segmentation on the bias of technological progress.And its impact mechanism.Based on the above issues,this article has carried out related theoretical and empirical research.This article is divided into seven chapters.The basic framework is as follows:The first chapter introduces the research background,significance and possible innovations of this article.The second chapter mainly reviews relevant literature and sorts out.The third chapter builds a model to measure the technical progress bias index and the factor price distortion index.Chapter 3 first constructs an index that can accurately characterize the level of bias in technological progress.Second,it uses the production function method to estimate the factor price distortion index,and finally uses the price index method to measure the market segmentation index.Chapter IV discusses the possible causes of the bias of technological progress by using the provincial panel data of China.On the basis of the previous chapter,Chapter 5 provides an in-depth analysis of the impact mechanism.Chapter 6 expands and analyzes the heterogeneity of factor price distortion effects.Chapter VII summarizes,policy recommendations and related discussions.The study of this paper finds that:(1)The increase in the distortion of the labor price will restrain the increase of the technology bias index of the enterprise,which means that the marginal output of labor is lower than its price,which will make the company choose the method of technological progress that favors labor.(2)Some scholars believe that the technology of developed countries can be directly introduced through international trade,and that technology mimicry has enabled our country to directly replicate the technology that developed countries are biased towards capital.Therefore,China’s technological progress is also biased towards capital.This article finds that international trade promotes technological progress toward capital by affecting factor prices.The empirical results show that the import trade will make the technological progress tend to capital,but the export trade does not affect the bias of technological progress.Further,after introducing the intermediary factor of factor price distortion,we find that import trade reduces labor price distortions,which in turn makes the price of capital lower than its marginal output relative to the price of labor,prompting companies to choose a method of technological progress that favors capital.(3)The labor market segmentation will promote the capital bias of technological progress.The labor price distortion is the intermediary variable of this influence mechanism.That is,the market segmentation reduces the price distortion of the labor factor,and the relative price of labor rises,leading the enterprise to choose the biased capital technological progress.In addition,this paper finds that the reason why the interregional market segmentation will ease labor price distortions is that the partitioned barriers increase the average labor compensation in the region.