Disaggregate productivity growth sources of regional industries in China

Lan Bing Li, Cong Cong Zhang, Jin Li Hu*, Ching Ren Chiu

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

This paper extends a global slack-based productivity indicator and constructs a unified framework that consists of global and factor levels of total factor productivity (TFP) to evaluate the performance of regional industries, thus enabling global productivity improvement based on factor-level sources. Evaluating regional industrial performance in China during 1995–2014, the findings reveal that rapid growth of industry in China is not only driven by a huge amount of input, but also by TFP improvement, with industrial productivity driven mainly by technology progress and presenting a gradually increasing trend. Regional productivity performances are imbalanced, in which the east ranks first due to its dual advantages of input and output factors. For source identification, input and output jointly contribute to industrial productivity improvement, but output has a much higher contribution ratio to industrial productivity improvement than input, because it is mainly rooted in desirable output. Finally, on the input side, labor is the primary factor driving input productivity improvement followed by energy, while capital productivity shows very slight growth.

Original languageEnglish
Number of pages27
JournalEmpirical Economics
DOIs
StatePublished - 4 Nov 2019

Keywords

  • Factor-level productivity indicator
  • Global slack-based productivity indicator (GSBPI)
  • Regional industrial growth
  • Source identification

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