The Effect of Factor Structure Change on Factor Productivity:Empirical Evidence from the Angle of Biased Technological Progress

Technological progress is always the focus of endogenous economic growth theory,but literature ignores the effects of biased technological progress and factor structure on economic efficiency.Meanwhile,the study on industrial biased technological progress is scarce.Based on CES production function,this paper employs three standardization equations to estimate the industrial biased technological progress in China and examines the effect of factor structure change on factor productivity.The results show that: firstly,in China,the technological progress in all industries is biased,and factor endowments lead to a trend of phased changes in technological progress and industrial differences of technological progress;the technological progress in financial industry is featured by labor bias on the whole that is different from the technological progress in other industries with an alternation between capital and labor bias;secondly,the change trend of industrial factor structure and its power source differ widely,and the change in industrial capital investment structure mainly stems from changes in investment returns while the change in labor structure is from investment returns and industrial structure;thirdly,the decomposition of the effects of biased technological progress and factor structure on marginal factor productivity shows that the relative marginal productivity of capital and labor in all industries declines due to the decrease in the effect of factor structure;moreover,except the financial industry,the biased technological progress effects in other industries play the role in promoting the relative marginal productivity of capital and labor.