The Influence Of Factor Price Distortion On The Export Competitiveness Of China’s Manufacturing Industry

In order to cope with the global economic downturn,the manufacturing industry has become a key breakthrough to achieve economic quality improvement.Since the18 th National People’s Congress,China has repeatedly mentioned the important topic of "consolidating the foundation of manufacturing industry" and built a strong manufacturing country.The 20 th National People’s Congress has also emphasized accelerating the transformation of manufacturing industry from "manufacturing" to "intelligent manufacturing".Although many industries in country’s manufacturing industry have achieved certain production strength in the international market by virtue of scale advantages and technological changes,some crucial technologies for production still need to rely on foreign countries,so that their export competitiveness is limited.Therefore,with the great tread of world economic transformation brought forth by new technological revolution,we need to firmly grasp the opportunities of the times,strive to promote the integration of manufacturing with new economic growth engines such as information technology and artificial intelligence,changing the production mode,complementing the weaknesses with innovation-driven,and improving our export competitiveness.Only do that can we obtain more survival space in the global competition.With the deepening of reform and opening-up,the export scale of Chinese manufacturing industry has reached new highs.The main reason is that in order to support the development of the manufacturing industry,the government has shaped the competitive advantage of the manufacturing industry by lowering the factor price.Although this way has achieved certain results in the short term,for the manufacturing industry that is heavily dependent on resources,the long-term factor price distortion has hindered the play of market regulation,the fairness and rationality of factor resource allocation has been ignored,The low efficiency of allocation affects the overall output level of the industry,then affects the improvement of the export competitiveness of the manufacturing industry.Therefore,this paper aims to study the related issues of improving the export competitiveness of the manufacturing industry from the perspective of factor price distortion.First of all,this paper analyzes the impact mechanism of factor price distortion on the export competitiveness of manufacturing industry,puts forward the basic assumptions of this paper.Secondly,by collecting the relevant data of 30 provinces in China(excluding Tibet Autonomous Region,Hong Kong,Macao and Taiwan)from 1996 to 2020,using the Cobb-Douglas production function to measure the degree of deviation between factor prices and actual output in 30 provinces in China,it is found that factor prices in each province have different degrees of distortion,which is mainly reflected in the higher degree of capital distortion than that of labor distortion,The overall factor price distortion shows a decreasing trend from west to east;Further,build a relevant indicator system from the two dimensions to measure the level of manufacturing export competitiveness of each province.The result shows that the manufacturing export competitiveness of each province is on the rise,but the growth is slowing,and the manufacturing competitiveness of the coastal provinces is far better than that of the central and inland provinces.In addition,based on the analysis of the mechanism and the collection of relevant data,this paper constructs an econometric model to deduce the relationship between factor price distortion and the export competitiveness of manufacturing industry.Finally,in order to meet the current economic development trend,digital technology is included in the model to explore the possibility of digital technology to help manufacturing export competitiveness.The empirical results show that: first,factor price distortion has a significant inhibitory effect on manufacturing export competitiveness,and the higher the degree of distortion,the more obvious the inhibitory effect;Second,the distortion of capital price has a negative impact on the export competitiveness of China’s manufacturing industry,but the distortion of labor price has the opposite effect;Third,digital technology alleviates the negative impact of factor price distortion on the manufacturing industry.Finally,recommendations for changing situations are shown below: appropriately relax the government control,continue to liberalize interest rates,improve the financial supervision system,and ease the distortion of factor prices;We will increase investment in research and development of digital technology,encourage inland regions to open up at a higher level,and create new competitive advantages for manufacturing exports.