Productive Performance in Chinese Enterprises: An Empirical Study

203 Pages·1996·10.593 MB·English

by  Yanrui Wu

STUDIES ON THE CHINESE ECONOMY
General Editors: Peter Nolan, Lecturer in Economics and Politics,
University of Cambridge, and Fellow and Director of Studies in
Economics, Jesus College, Cambridge, England; and Dong Fureng,
Professor, Chinese Academy of Social Sciences, Beijing, China
This series analyses issues in China's current economic development,
and sheds light upon that process by examining China's economic
history. It contains a wide range of books on the Chinese economy past
and present, and includes not only studies written by leading Western
authorities, but also translations of the most important works on the
Chinese economy produced within China. It intends to make a major
contribution towards understanding this immensely important part of the
world economy.
Published titles include:
Derong Chen
CHINESE FIRMS BETWEEN HIERARCHY AND MARKET
Dong Fureng
INDUSTRIALIZATION AND CHINA'S RURAL MODERNIZATION
Du Runsheng (edited by Thomas R. Gottschang)
REFORM AND DEVELOPMENT IN RURAL CHINA
Qimiao Fan and Peter Nolan {editors)
CHINA'S ECONOMIC REFORMS
Christopher Findlay, Andrew Watson and Harry X. Wu (editors)
RURAL ENTERPRISES IN CHINA
Jiann-Jong Guo
PRICE REFORM IN CHINA, 1979-86
Michael Korzec
LABOUR AND THE FAILURE OF REFORM IN CHINA
Ryoshin Minami
THE ECONOMIC DEVELOPMENT OF CHINA
Yuming Sheng
INTERSECTORAL RESOURCE FLOWS AND CHINA'S ECONOMIC
DEVELOPMENT
Wang Xiaoqiang and Bai Nanfeng (translated by Angela Knox)
THE POVERTY OF PLENTY
Malcolm Warner
THE MANAGEMENT OF HUMAN RESOURCES IN CHINESE
INDUSTRY
Productive Performance
in Chinese Enterprises
An Empirical Study
Yanrui Wu
Chinese Economy Research Unit
University of Adelaide
First published in Great Britain 1996 by
MACMILLAN PRESS LTD
Houndinills, Basingstoke, Hampshire RG21 6XS
and London
Companies and representatives
throughout the world
A catalogue record for this book is available
from the British Library.
ISBN 0-333-63385-7
First published in the United States of America 1996 by
ST. MARTIN'S PRESS, INC.,
Scholarly and Reference Division,
175 Fifth Avenue,
New York, N.Y. 10010
ISBN 0-312-12832-0
Library of Congress Cataloging-in-Publication Data
Wu, Yannii.
Productive performance in Chinese enterprises : an empirical study
/ Yanrui Wu.
p. cm. — (Studies in the Chinese Economy)
Includes bibliographical references and index.
ISBN 0-312-12832-0 (cloth)
1. Industrial productivity—China. 2. Industrial efficiency-
-China. 3. Industrial policy—China. I. Title. II. Series.
HC430.I52W8 1996
338.0951—dc20 95-51524
CIP
© Yanrui Wu 1996
All rights reserved. No reproduction, copy or transmission of
this publication may be made without written permission.
No paragraph of this publication may be reproduced, copied or
transmitted save with written permission or in accordance with
the provisions of the Copyright, Designs and Patents Act 1988,
or under the terms of any licence permitting limited copying
issued by the Copyright Licensing Agency, 90 Tottenham Court
Road, London W1P9HE.
Any person who does any unauthorised act in relation to this
publication may be liable to criminal prosecution and civil
claims for damages.
10 9 8 7 6 5 4 32
05 04 03 02 01 00 99 98 97
Printed and bound in Great Britain by
Biddies Ltd, Guildford and King's Lynn
To Xiumei, Amy and David

Contents
List of Figures viii
List of Tables ix
Preface xi
List of Abbreviations xiii
Introduction 1
PART I GENERAL ISSUES
1 Industrial Growth and Performance IS
2 Economic Reform and Efficiency 29
PART II LITERATURE SURVEY
3 Efficiency Studies 1: the Theory 43
4 Efficiency Studies 2: Applications to China 55
PART III EMPIRICAL STUDIES
5 Industrial Performance at the Macro Level 69
6 Scale, Factor Intensity and Efficiency: the Coal Industry 87
7 Potential Determinants of Efficiency: the Iron and
Steel Industry 103
8 One Industry, Two Regimes: the Textile Sector 119
Conclusion 137
Appendixes
A: Reasons for the Rural Industrial Boom 145
B: Alternative Models 148
C: Technical Efficiency Rates of Coal Firms 149
D: Technical Efficiency Rates of Iron and Steel Firms 151
E: Panel Data of Rural Textile Firms 153
Notes 155
Bibliography 163
Index 181
vii
List of Figures
1.1 GDP shares by sector, 1953-90 16
1.2 GDP values by sector, 1953-90 17
1.3 Growth rates of the rural and state industrial GVO, 1981-90 18
1.4 Industrial GVO shares by sector, 1981-91 19
2.1 The ownership structure of Chinese industry 32
3.1 Production frontier and efficiency 48
5.1 Market, retail and estimated price indexes, 1990 71
5.2 Scale distribution of rural and urban industries 74
5.3 Labour and capital productivity of rural and urban industries 79
5.4 Map of the regions of China 82
5.5 Output distribution of rural and urban industries, 1986
and 1990 83
5.6 Mean efficiency of rural and urban industries, 1986 and 1990 84
6.1 Choice of technology . 90
6.2 Output distribution of raw coal by ownership, 1978 and 1984 100
8.1 Gross value of output of rural textile industry 119
A. 1 State loans to rural industrial sector 146
A.2 Savings by rural household 146
Vlll
List of Tables
1.1 Production and employment patterns of China and other
countries 21
1.2 Output, input and TFP growth rates of selected countries 24
1.3 Output, input and TFP growth rates in China 25
1.4 Material use indicators of selected countries 26
2.1 Output shares by ownership in Chinese industry, 1953-91 32
2.2 GDP shares and growth rates 36
2.3 GDP shares and growth rates of selected countries, 1990 37
5.1 Estimation results of urban and rural industrial models 73
5.2 Production structure of rural and urban industries
(output shares) 76
5.3 Mean efficiency rates of rural and urban industries, 1985-90 80
6.1 Summary statistics of the sample data - 92
6.2 Definitions of dummy variables 94
6.3 Estimation results of stochastic frontier models 95
6.4 Mean statistics of mines of various groups 98
7.1 Summary of main hypotheses 108
7.2 Summary statistics of the data sample 111
7.3 Maximum likelihood estimation results 113
7.4 Sources of efficiency differentials 115
8.1 Characteristics of the 28 rural textile firms 121
8.2 Estimation results of the panel data model 123
8.3 Technical efficiency rates of 28 firms, 1984-90 124
8.4 Characteristics of the top and bottom ten rural textile
firms, 1990 126
8.5 Output values of rural and urban textile industries, 1985
and 1989 131
8.6 Characteristics of rural and urban textile firms, 1986 133
8.7 Estimation results of the urban textile firms, 1986 134
8.8 Technical efficiency rates of urban textile firms, 1986 134
B.I Estimation results of alternative models (1-3) 148
C. 1 Technical efficiency rates of 255 coal firms 149
D.I Technical efficiency rates of 87 iron and steel firms 151
D.2 Definitions of the dummy variables 152
E.I Panel data of rural textile firms 153
IX