Has Productivity Contributed to the Economic Growth of Yangtze River Delta?

Sammanfattning: The principal issue of my thesis is to identify the sources of economic growth in Yangtze River Delta (YRD). Review of YRD post-reform development is conducted. The empirical study examines total factor productivity (TFP) growth, which is decompoed into three parts: technical progress, efficiency change and the scale effect in 16 component cities in YRD. Panel data of 1985-2007 are analyzed using the stochastic frontier model. The major issues consider as (1) analyzing the source of YRD growth in which productivity growth is decomposed into three components: technical progress, changes in technical efficiency and the scale effect, (2) comparing the productivity and efficiency performance among cities and finding the tendency between the results from different parts of TFP growth, and (3) providing the explanation for my estimation and policy implication. YRD’s growth has been mostly input-driven and TFP growth by average 9.5% each year. To sustain the engine position in China, YRD should take effort to enhance the technology level and introduce in technical innovation from outsides.