Structural Change and Economic Growth in China

By Shanhui Fan, Xiaobo Zhang, Sherman Robinson. Review of Development Economics, 2002

152 citations recorded by the source corpus.

This study develops a new analytical framework to account for sources of rapid economic growth in China. The traditional Solow approach is expanded to include another source of economic growth-structural change. The empirical results show that structural change has contributed to growth significantly by reallocating resources from low-productivity sectors to high-productivity sectors. It is found that the returns to capital investment in both agricultural production and rural enterprises are much higher than those in urban sectors, indicating underinvestment in rural areas. On the other hand, labor productivity in the agricultural sector remains low, a result of the still large surpluses of labor in the sector. Therefore, further development of rural enterprises and an increase in labor flow among sectors and across regions are key to improvements in overall economic efficiency. Copyright Blackwell Publishing Ltd 2003.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/9de8a0e68e8a772ca45c0e93b27dfb1bd65285a5

How researchers see this paper

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In Economics and Econometrics

1. Shanhui Fan
2. Xiaobo Zhang
3. Gang Li
4. Shuaihe Zhuo
5. Zefu Wu
6. Jason Li Chen
7. Jie Wu
8. Carey Goh

Citations in the corpus

• National innovation system, social entrepreneurship, and rural economic growth in China (2017, background): “For example, Fan et al. (2003) showed that rural economic growth (as reflected by rural labor productivity) is closely related to economic growth in the nation as a whole.”
• From “Made in China” to “Innovated in China”: Necessity, Prospect, and Challenges (2017, unknown): “Sectoral productivity and structural change accounted for 42 and 17 percent of economic growth during 1978–1995 (Fan et al. 2003).”
• Tourism and regional income inequality: Evidence from China (2016, background): “Fan, Zhang, and Robinson (2003) point out that China has significant potential for efficiency improvement via continuous structural change given that there are large differences in both labor and capital productivity among various sectors.”
• Infrastructure and regional economic development in rural China (2004, background): “In existing literature, China’s rapid economical growth and uneven development has been extensively researched (Chen et al., 1995; Fan and Pardey, 1997; Fan et al., 2003; Fan and Zhang, 2004).”
• Agricultural productivity, structural change, and economic growth in post-reform China (2013, unknown): “The existing macroeconomic literature approaches Chinese agriculture by examining aggregate data only; see, e.g., Chow (1993), Fan and Zhang (2002), Fan et al. (2003), and Dekle and Vandenbroucke (2010, 2012).”
• Fifty Years of Regional Inequality in China: A Journey through Central Planning, Reform, and Openness (2005, unknown): “However, while a large literature has studied growth through these different phases of Chinese history (e.g. McMillan et al., 1989; Lin, 1992; Fan et al., 2003), few studies have matched the evolution of inequality over the long run with these different periods in Communist Chinese history over its ”