The Effect of Technical Progress on Employment and the Choice of Technical Progress Policy

Technical progress has become drive of economic growth,and it is playing more and more important roles in economic growth.On the basis of the analysis of technical progress reflected by the change in total factor productivity(TFP) which is estimated through Solow model by adopting provincial data from 1980 to 2006 in Liaoning,the paper explores the effect of technical progress and technical progress policy on employment and argues that,despite its aid to optimization of employment structure,technical progress exhibits a significant negative effect on employment growth which can be better eliminated by developing applicable technology,adding fiscal expenditure on education,paying attention to the development of SMEs and encouraging enterprises to innovate.