Factor market’s distortion, Markup and TFP
Read
DownLoad |
| Title | Factor market’s distortion, Markup and TFP
|
| Author | Gai Qingen,Zhu Xi,Cheng Mingwang and Shi Qinghua |
| Organization | Shanghai University of Finance and Economics; Shanghai Jiao Tong University; Tongji University |
| Email | gai.qingen@shufe.edu.cn；zhuxi97@sjtu.edu.cn；walkercheng@163.com；shq@sjtu.edu.cn |
| Key Words | Resource misallocation, Monopoly power, Total Factor Productivity |
| Abstract | Resource misallocation can lower aggregate total factor productivity (TFP). This paper constructs relationship among factor market’s distortion, monopoly power and TFP through a Theoretical model and exploit micro data on manufacturing establishments during 1998-2007 to quantify the potential extent of misallocation in China. The result shows manufacturing TFP gains of 70.88%-88.75% if we can eliminate marginal product gap of firms. The main distortion is from capital market, markup is in the second position, and minimal distortion is the labor market. At the end, we check different effect related to labor income’s share, state-owned enterprises and firm’s size. The main result has the same trend as previous research and our model is robust. |
| Serial Number | WP793 |
| Time | 2015-01-06 |
|