ECON 455 Lecture 6 Growth accounting and structural change

ECON 455 Lecture 6 Growth accounting and structural change...

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Unformatted text preview: 1 1 Econ455: Economic Development in China Lecture 6: January 29 Growth accounting and structural change Sandra Poncet Lorch Hall, room 207 Email: sponcet@umich.edu Office Hours: Mondays 16:30-18:30 & Wednesdays 10:30-12 __________________________________________________________________ __________________________________________________________________ __________________________________________________________________ __________________________________________________________________ __________________________________________________________________ __________________________________________________________________ __________________________________________________________________ 2 2 Undeniable rapid economic growth in China Ongoing debate about the true nature of Chinas growth:-reliability of the statistics-just one-time recovery from the chaos of Mao's later years-some argue that most growth is driven by input with only modest growth in efficiency (Krugman, 1994; Young, 2003): Perspiration' versus 'inspiration' . Ongoing debate about the sustainability of Chinas growth:-is growth due to a one-time transition from agriculture to more productive sectors?-is capital quality also improving or is that just pilling up?-is Chinas growth autonomous (independent of external markets)? Introduction ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ ___________________________________________________________ 3 3 Lecture Outline I-Chinese growth performance I-1-Statistics A- Rapid growth B- Issue of the counterfactual C- Unreliable statistics I-2-Decomposition of past growth A-Production function method B- Results: respective role of factor accumulation and TFP II-Structural change in China II-1-Transfer from agriculture to industry II-2-Quality matters Conclusion: Sustainability and fundamental factors of growth __________________________________________________________________ __________________________________________________________________ __________________________________________________________________ __________________________________________________________________ __________________________________________________________________ __________________________________________________________________ __________________________________________________________________ 4 4 I-Chinese growth performance I-1-Statistics A-Rapid growth Chinas post1978 growth experience has been extraordinary by any standard....
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ECON 455 Lecture 6 Growth accounting and structural change...

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