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What Drives China's Growth?


  • Linda Yueh


This paper analyses the drivers and components of China's economic growth, showing that the structure of the economy is just as important as standard growth factors in determining its growth. The structural reforms that dismantled state-owned enterprises and shifted factors from agriculture to urban areas are key, as are technology transfers and know-how. Taking these factors into account, the paper shows that total factor productivity (TFP) not derived from those one-off reforms accounted for less than one-eighth of China's GDP growth during the first thirty years of the reform period. There are signs that efficiency is improving in the 2000s and productivity must continue to increase for the country to sustain its development.

Suggested Citation

  • Linda Yueh, 2013. "What Drives China's Growth?," National Institute Economic Review, National Institute of Economic and Social Research, vol. 223(1), pages 4-15, February.
  • Handle: RePEc:sae:niesru:v:223:y:2013:i:1:p:r4-r15

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    Cited by:

    1. Neil Foster-McGregor & Johannes Pöschl & Ana Rincon-Aznar & Robert Stehrer & Michaela Vecchi & Francesco Venturini, 2014. "Reducing Productivity and Efficiency Gaps: the Role of Knowledge Assets, Absorptive Capacity and Institutions," wiiw Research Reports 396, The Vienna Institute for International Economic Studies, wiiw.

    More about this item


    Economic growth; China; economic reform; productivity;

    JEL classification:

    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • P2 - Economic Systems - - Socialist Systems and Transition Economies


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