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Domestic versus foreign capital and returns to scale in China's provincial industries

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  • Erkin Bairam

Abstract

This paper is mainly concerned with estimating an appropriate production function for the Chinese industry using provincial data. The estimated equations suggest that the appropriate production function is a Cobb-Douglas which reveals statistically significant economies of scale. The results reported also reveal that the marginal product of foreign capital is significantly higher than that of domestic capital used in the production process in all but one province.

Suggested Citation

  • Erkin Bairam, 1999. "Domestic versus foreign capital and returns to scale in China's provincial industries," Applied Economics Letters, Taylor & Francis Journals, vol. 6(9), pages 621-624.
    • Handle: RePEc:taf:apeclt:v:6:y:1999:i:9:p:621-624
    DOI: 10.1080/135048599352745
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    References listed on IDEAS

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    1. Kuan, Chen & Hongchang, Wang & Yuxin, Zheng & Jefferson, Gary H. & Rawski, Thomas G., 1988. "Productivity change in Chinese industry: 1953-1985," Journal of Comparative Economics, Elsevier, vol. 12(4), pages 570-591, December.
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    Cited by:

    1. Kefei You & Nicholas Sarantis, 2013. "Structural breaks, rural transformation and total factor productivity growth in China," Journal of Productivity Analysis, Springer, vol. 39(3), pages 231-242, June.
    2. Onyango, Christopher H., 2010. "Liberalization of Services and its Implications on Cross-Border Agricultural Trade in Eastern Africa," Conference papers 332028, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.

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