Transcript 幻灯片 1

the Model of the Economic Growth,
Industrialization and Urbanization in China
NI Pengfei
China‘s economic growth miracle
 Over the past 30 years, China's economy
maintained at close to 10% of the average
growth, which is a miracle.
 from the demand point of view, China's
economic growth is a major contributor to
exports and investment.
 Investing
primarily
by
government
investment and real estate, infrastructure
investment.

China GDP growth (annual %)
16
14
12
10
8
6
4
2
0
Per capital GDP in China(1981-2011)
25000
20000
15000
Per capital GDP in China
10000
5000
0
1981
2011
GDP in China(1981-2011)
350000
300000
250000
200000
GDP in China
150000
100000
50000
0
1981
2011
Mutiple of GDP and Per capital GDP growth
70
60
50
40
30
20
10
0
Per capital GDP in China
GDP
Contribution Share of the Three Components of GDP
100%
0.3
1.8
7.6
12.5
1.0
6.0
22.8
26.4
80%
50.4
55
16.0 17.9
4.0
9.0
22.4 49.9
48.5 63.2 54.5
66
60%
38.5
80.9
52.9
46.9
48.8
43.6 42.5
Net Exports of
Goods and
Services
87.6
1.8
40%
20%
0%
71.8
39.4
65.1
85.5
-40%
47.8 44.7
50.2
43.9
44.1
35.8 39.5 38.7 40.4 39.6
43.1
55.5
49.8
-0.1
-5.4
-66.4
-20%
Gross Capital
Formation
-4.3
-37.4
Final
Consumption
Expenditure
Contribution of the Three Compon
ents to GDP
25
Net Exports of Goods and Services
20
Gross Capital Formation
Final Consumption Expenditure
15
10
5
0
1978 1980 1985 1990 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
-5
-10
-15
Explain the miracle of China‘
s economic growth
 About the Chinese economic miracle,
Past scholars have interpreted from different
angles. The basic point is: opening up and
economic globalization; domestic market-oriented
reforms; government, especially local government's
active intervention.
 About the Chinese model,
Past scholars to generalize from a different
perspective. We tried to industrialization and
urbanization development perspective to explain
this miracle.
。
Industrialization and Urbanization
Path
 Industrialization and Urbanization
in a closed economy
 domestic
labor
combined
with
domestic capital, have only both
domestic markets
the development in agriculture sector release labors;
the industrial demand of labor drive urbanization,
and industrial products sell to domestic labor.
Industrialization paralleled with urbanization.
Industrialization and Urbanization
Path
 Industrialization and Urbanization
in an open economy
 domestic labor combined with forei
gn capital, meanwhile, have both d
omestic and foreign markets。
the development in agriculture sector release
labors;
the industrial demand of labor drive urbanization,
and industrial products sell to abroad.
Industrialization did not paralleled with
urbanization.
China‘s industrialization, urbanization
and high-growth conditions
 China has the largest low-cost surplus la
bor and other resources, so that it has a
huge potential comparative advantage.
 On the one hand, through LianChanChengBao
system, relax hukou regulation, the rural
surplus labor to be released。
 On the other hand, through the opening,
Foreign capital and markets to be used。
 Combination above can achieve industriali
zation and urbanization, thus promoting e
conomic growth。
The institution arrangement in China
 Evaluation regime:
Economic
projects”.
growth
with
visible
“image
 Fiscal regime:
“eat in separated stove"; unmatched local
taxing system and government function. Public
service is mainly provided by local
government.
The institution arrangement in China
 The land regime：
Urban state-owned city land can be used as construction land.
Rural collective land can not be used as construction land;
Governments transfer the rural collective land to urban stateowned land through land acquisition process; Government
enforce to sell the land use right. Government enforce land
collection; Government own monopolized selling right.
 Financial regime:
Local governments can finance through land mortgage,
and then make massive investments
 Hukou regime
Public services are associated with Hukou: public service is
proviovded according to citizen’s Hukou rather than living
location.Unequal service level in city and rural region.
Central government’s intention
 The local government is encouraged in promoting economic
growth due to the current tax and evaluation arrangement.
 On the condition of the current separated fiscal regime, both
the central and local government prefer to collect more by
serve less. The local government is unwilling to provide extra
services for residents without hukou.
 These systems led to the over-emphasis on economic
growth as the ultimate goal of development
Central government’s intention
 The local government can attract FDI through selling
the industry-use land with low fee, while obtain
revenue by selling business-use land with high price.
prove the investment environment, thereby
promoting
industrialization,lands’urbanization and
economic growth
 City government does not provide public services for
immigrated
people,
Limit
population
urbanization
。
The path of industrialization,urbanizatio
n and economic growth in China
 Two ways
growth
to
promoting
economic
 in the past: urbanization driven by
industrialization
which
was
motivated
by
economic
growth.
“Urbanization driven by growth for
growth
The path of industrialization,urbanizati
on and economic growth in China
Costal east region: industrialization
drive urbanization. On the one hand, the
low cost industry use land cost and
improved infrastructure that are funds by
high business land premium could attract
foreign investment. On the other hand,
manufacture absorbed the ample rural
labor surplus with low payment. Industry
products win the foreign market result
from the comparative advantages of labor
The path of industrialization,urbanizat
ion and economic growth in China
Inland
region:
construction-lead
urbanization drives economic growth.
Cities
without
the
comparative
advantages purse economic growth
derided
from
investment
on
infrastructure construction and real
estate development.
China Employment in no agriculture (% of total
employment)
70
60
50
40
30
20
10
0
China Urban population (% of total)
60
50
40
30
20
10
0
Urbanization pattern in China
 Styles of Land driven urbanization:
expand old city ， exploit new city ，
industrial park
 Excessive Land urbanization: land has
become the major resource serving for
economic
growth.
More
land
are
urbanized than people. Giving land for
investment; selling land for economic
growth, selling land for fiscal
revenue.
Urbanization pattern in China
 Styles
of
population
driven
urbanization: education ， migration ，
urban expansion，investment
 Half people completed urbanization(3518%=17%）
Because of economic growth, one part
of rural people get town hukou by
accepting high education and becoming
specialized skill labor They usually
have high income level.
Urbanization pattern in China
Another part of rural people obtain
the town hukou by urban sprawl and
expansion.
 Half people partly urbanization （ 5235%=17%）
Rural labor come to city and work in
city. On one hand, the low salary can
not afford high living cost in city.
On the other hand, city governments
are unwilling to provide necessary
public services.
Urbanization Rate
60
50
register population in
China(%)
inhabitant in China(%)
40
30
20
10
0
1981
2011
Urbanization population and Area
8
7
1981
2011
6
5
4
3
2
1
0
register population in China
inhabitant in China
Area of Built Districts (ten
thousand sq.km) in China
mutiple of urban population and Area growth
in 1981-2011
7
6
5
4
3
2
1
0
register population
inhabitant
Area of Built Districts (ten
thousand sq.km)
Comparative advantage is weakening
 United Nations Forecast, by 2017 or so
, China 15-64 population growth rate w
ill be from positive to negative
 Labor costs are rising
 Remanufacturing of developed countries
 Transfer to neighboring countries
 China Net exports are falling
 FDI has begun to decline
Slow economic transformation
 Government investment, impede fair comp
etition in the market, limiting private
sector development
 Real estate investment profits, weakeni
ng real industrial development, inhibit
ing investment in education and technol
ogy, impede technological innovation.
 Contribution of TFP to economic growth
declined Last decade
 Local governments face greater liabili
ties and default risks
Contribution of TFP to economic
growth declined
Sharp social contradictions
 There are currently nearly 200 million m
igrant workers their important matters h
ave been solved in full employment, chil
dren's education, medical care, social s
ecurity, housing, social integration and
so on.
 In the land, not only develop is strictl
y limited by 18 million mu of arable lan
d red line , and social conflicts around
land acquisition and resettlement is ver
y sharp.
Property-Value Bubble
Water Pollution in China
Air Pollution in China
Air Pollution in China
Conclusion
 Open and large-country economy coined
the
characteristics
of
Chinese
industrialization urbanization pattern,
but the path is unsustainable.
 Both
reform
and
technological
innovation
is unsuspected. We need a
new pattern. The new urbanization is
people-originated instead of city’s
urbanization. The aim is to improve
social welfare rather happiness of
people rather than economic growth.
Thank you！