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Evaluation of the sophistication of Chinese industries using the information-geometric decomposition approach

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  • Takanori Minamikawa

    (Economic Research Institute for Northeast Asia (ERINA))

Abstract

Since the Open Door Policy was implemented in 1978, China economy has maintained a high economic growth. During this period, although the reform of state-owned enterprises and the introduction of foreign direct investments might cause the change of the industrial structure, the common recognition, about how those factor has changed Chinese industrial structure, has not been obtained. This paper applied information geometric decomposition to Input-Output tables of China in the period 1981 to 2010, and extracted the factors of the technological changes in the whole industry in China. This paper examines the different of evaluation of industrial structure between input coefficient index and information geometry approach. Furthermore based on the factors, two industrial sophistication indicators, which are about degree of Mechanization and degree of ICT introducing, respectively are constructed. The empirical results suggests that the degree of mechanization and included ICT has different characteristics for each other. Regarding mechanization, the mechanized manufacturing sectors showed increases in sophistication in the 1980s and 2000s; however, mechanized tertiary sectors showed increases in sophistication in the 1990s. Regarding ICT input, while manufacturing sectors showed a high level of sophistication in ICT input in the 2000s, tertiary sectors showed a high level of sophistication in ICT input in the 1990s.

Suggested Citation

  • Takanori Minamikawa, 2018. "Evaluation of the sophistication of Chinese industries using the information-geometric decomposition approach," Discussion papers 1801-2e Classification- C, ERINA - Economic Research Institute for Northeast Asia, revised Apr 2018.
    • Handle: RePEc:eri:dpaper:1801-2e
    as

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    References listed on IDEAS

    as
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    3. Jeon, Yongbok & Park, Byung Il & Ghauri, Pervez N., 2013. "Foreign direct investment spillover effects in China: Are they different across industries with different technological levels?," China Economic Review, Elsevier, vol. 26(C), pages 105-117.
    4. Shang, Qingyan & Poon, Jessie P.H. & Yue, Qingtang, 2012. "The role of regional knowledge spillovers on China's innovation," China Economic Review, Elsevier, vol. 23(4), pages 1164-1175.
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    Keywords

    Input-Output tables; Industrial structure; RAS method; Foreign Direct Investment; Innovation;
    All these keywords.

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