Institutional Elasticity,Growth Matching and Economic Growth

Institutional reform has been proven to be the main cause of economic growth in China.However,there are still some questions:how is the performance of Chinese institutional reform? Will the incremental and outside system reform still be an important part of Chinese reform? We construct an index system to measure elasticity of institutional reform on the basis of the theoretical logic of institutional reform.We analyze the panel data of 28 provinces during 1982—2011,capture the tendency of institutional elasticity since China implemented the reform and opening-up policy.We find that the institutional elasticity is weakening,and the growth contributed by reform as before is limited and institutional reform is getting harder.If China holds the institutional elasticity as early stage of reform and other assumption keeps still,the ideal output is at least 1.499 times as much as that of 2011.In conclusion,the Chinese economic growth is likely to speed up with the help of further institutional reform.