A Study On The Influence Of Chinese City Scale On Total Factor Productivity Of Enterprises

China’s national economy has gradually changed from high-speed growth model to high-quality growth model.A healthy economic growth cannot maintain with the extensive pattern of increasing investment quota and labor supply.In the future,the economic development relies more on technological improvement.With the progress of urbanization and industrialization,the productivity of enterprises,which is the micro-subject of economic development,has significantly enjoyed the positive effects brought about by the scale advantage of cities.This paper focuses on the changes in the productivity of enterprises in the process of urbanization,and aims to explore the impact of city scale improvement on the total factor productivity of enterprises.Based on the heterogeneous enterprise location selection model,this paper establishes a theoretical model that includes the urban population and the total factor productivity of enterprises in cities.This paper also proposes the machanism and the method to identify the machanism behind the effect.The financial data of chinese listed manufacturing companies and the statistics of 225 prefecture-level cities with listed companies during 2007 and 2016 were selected to analyze the impact of city scale on the total factor productivity.We further group enterprises according to the ranking of their total factor productivity,and analyze the mechanism of the effect that city scale poses on the impact of total factor productivity,thus,to identify the agglomeration effect and selection effect behind.We find that the improvement of city scale promotes the the total factor productivity of enterprises.In general,for every 1% increase in the city scale,the total factor productivity increases by 0.0019%.The non-state-owned enterprises and foreign-funded enterprises,compared with the state-owned enterprises and local enterprises,are moreinfluenced by the improvement of city scale.The improvement of city scale in the central and western regions is more effective in promoting the overall productivity of enterprises than in the developed regions in the east.By exploring the mechanism of the effects,we found that high-productivity enterprises enjoy the promotion effect of scale improvement in the eastern region,while the central and western regions poses more significant effect on enterprises with lower productivity.So that the agglomeration effect is more reflected in the eastern region.In the western region is the selection effect reflected.