Research on Efficiency of Service Industry of China Based on Malmquist Three-stage Model

This paper evaluates efficiency of service industry in Chinese provinces during 2003-2007 with Malmquist three-stage model.It is concluded that the efficiencies of many regions are affected by environmental variables.Economic openness has positive influence on the development of service industry,and the shrink of urban-rural gap also have positive influence;although investment scale of the service industry has increased,total factor efficiency has declined result of the efficiency's regression in recent years.In addition to the regional perspective,total factor efficiency of China has decreased to a large extent by the central and western regions' efficiency.