How Efficient Has Been China'S Investment? Empirical Evidence From National And Provincial Data
AbstractThis paper analyses both the allocative efficiency and the dynamic efficiency of China's spending on capital. We examine the relationship between investment flows and the marginal product of capital computed by estimating the Cobb-Douglas and CES production functions at both the national and provincial levels. We also investigate dynamic efficiency by comparing the share of capital in national income and the rate of investment. The main finding is that the allocative efficiency of capital in China has improved in recent years, but the high rate of investment may be a sign of dynamic inefficiency of the Chinese economy. Copyright 2007 The Authors Journal compilation 2007 Blackwell Publishing Ltd
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Bibliographic InfoArticle provided by Wiley Blackwell in its journal Pacific Economic Review.
Volume (Year): 12 (2007)
Issue (Month): 5 (December)
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Other versions of this item:
- Dong He & Wenlang Zhang & Jimmy Shek, 2006. "How Efficient Has Been China's Investment? Empirical Evidence from National and Provincial Data," Working Papers 0619, Hong Kong Monetary Authority.
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