Research On The Impact Of China's Industrial Structure Upgrade On TFP

Since the reform and opening up,China's economy has created a worldwide attention to the "Chinese miracle" after more than 40 years of rapid growth.However,the existing research holds that the rapid development of China's economic early stage is mainly achieved by relying on the high input and energy consumption of production factors.And with the economy entering the "new normal",this extensive economic growth model is not only unsustainable,but also brings about a series of problems such as waste of resources,environmental pollution and inefficiency,which affect the sustainable development At the same time,China's population dividend and labor cost advantage are gradually disappearing,so we must pay attention to the growth of total factor productivity,in order to cultivate a new impetus for the high-quality development of the economy.In 2015,General Secretary Xi Jinping put forward the "supply-side structural reform",aiming at realizing the reallocation of capital,labor force and innovation factors through the adjustment of economic structure,so as to change the mode of economic development.Among them,the reform and upgrading of industrial structure is the most important.The development experience of foreign developed countries tells us that in the process of upgrading and transformation of industrial structure,there may be some problems such as "cost disease" put forward by Baumol,which will have a negative impact on the improvement of total factor productivity.Based on the current situation of industrial restructuring and upgrading in China,this study empirically examines the impact of industrial restructuring on total factor productivity.Firstly,this paper investigates the current situation of industrial structure upgrading from two perspectives of rationalization and upgrading of industrial structure.The industrial structure upgrading can be divided into industrial structure upgrading and service industiy structure upgrading.It is found that both the level of industrial structure rationalization and the level of industrial structure upgrading have been improved in the sample period.Secondly,this paper uses DEA-Malmquist method to measure the total factor productivity of 30 provinces and municipalities in China from 2004 to 2016,and finds that the overall level of total factor productivity in China is gradually increasing.Finally,through the systematic GMM study which can control endogenous problems,we find that:(1)Rationalization of industrial structure has a significant inhibitory effect on the growth of total factor productivity.There exists the problem of"cost disease,put forward by Baumol,which may be related to the development quality of tertiary industry in China.At present,the development level of tertiary industry in our country is relatively low.Pursuing the rationalization of industrial structure blindly may make our development encounter Baumol's "cost disease" problem to a certain extent.(2)The upgrading of regional industrial structure has a significant positive effect on the growth of regional total factor productivity.High-tech industry often has relatively high technology level and productivity level.It can transmit knowledge and technology to other industries through technology platform,personnel flow,product flow and knowledge sharing,so as to realize the diffiision of high,tech and promote the growth of regional total factor productivity.(3)The upgrading of regional service industry structure has a negative but not significant impact on the growth of regional total factor productivity.The possible reason is that China's producer service industry has just started,and its development quality is not high,and its development mode is relatively extensive,which has not been able to effectively promote the progress of total factor productivity.In view of the above conclusions,this paper argues that in the process of industrial structure upgrading and adjustment in China,we should rationally view the trend of continuous service of industrial structure,persist in promoting the growth of total factor productivity as the ultimate goal,and avoid mismatch and waste of resources among industries.We should actively encourage high-tech enterprises to cooperate with traditional enterprises to promote technology spillover to the greatest extent.We give full play to the synergistic role of producer services among industries,in order to avoid Baumol's "cost disease" problem to the greatest extent,and enhance China's total factor productivity level.