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Total factor productivity growth and its contribution: lessons from the Chinese construction industry pre- and post-2008 financial crisis

Total factor productivity growth and its contribution: lessons from the Chinese construction... In response to the 2008 financial crisis, the performance of the Chinese construction industry seems to be more successful, especially in total factor productivity growth (TFPG) and its contribution (TFPGC). Hence, the purpose of this paper is to investigate and reveal the potential successful lessons in this regard.Design/methodology/approachThis study is conducted innovatively based on a special comparative analysis of TFPG and TFPGC between pre- and post-2008 financial crisis. Solow Residual Approach is used to measure TFPG and TFPGC for the period 2002–2016. Given that the crisis hit China at the end of 2008, the pre-2008 financial crisis period is from 2002 to 2008, and the post-2008 financial crisis period is limited to 2009–2016.FindingsThe results indicate that the industry indeed has better performance in promoting TFPG and TFPGC, TFP thus achieved significant accumulative growth before and after the crisis. However, from an evolutionary perspective, both TFPG and TFPGC presented an overall downward trend from before the crisis to after the crisis. Further, the game between the centrally planned economy and the market-oriented economy was identified and revealed as the essential reason behind the evolution of TFPG and TFPGC.Practical implicationsSome valuable lessons for policies and practices in promoting TFPG and TFPGC were summarized and learned from the Chinese experience, such as reducing administrative intervention and making the construction market play a decisive role.Originality/valueThis study provides some new empirical evidence to enrich the overall body of knowledge on growth theory, especially in promoting TFPG and TFPGC. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Engineering Construction & Architectural Management Emerald Publishing

Total factor productivity growth and its contribution: lessons from the Chinese construction industry pre- and post-2008 financial crisis

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References (78)

Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
0969-9988
DOI
10.1108/ecam-11-2019-0659
Publisher site
See Article on Publisher Site

Abstract

In response to the 2008 financial crisis, the performance of the Chinese construction industry seems to be more successful, especially in total factor productivity growth (TFPG) and its contribution (TFPGC). Hence, the purpose of this paper is to investigate and reveal the potential successful lessons in this regard.Design/methodology/approachThis study is conducted innovatively based on a special comparative analysis of TFPG and TFPGC between pre- and post-2008 financial crisis. Solow Residual Approach is used to measure TFPG and TFPGC for the period 2002–2016. Given that the crisis hit China at the end of 2008, the pre-2008 financial crisis period is from 2002 to 2008, and the post-2008 financial crisis period is limited to 2009–2016.FindingsThe results indicate that the industry indeed has better performance in promoting TFPG and TFPGC, TFP thus achieved significant accumulative growth before and after the crisis. However, from an evolutionary perspective, both TFPG and TFPGC presented an overall downward trend from before the crisis to after the crisis. Further, the game between the centrally planned economy and the market-oriented economy was identified and revealed as the essential reason behind the evolution of TFPG and TFPGC.Practical implicationsSome valuable lessons for policies and practices in promoting TFPG and TFPGC were summarized and learned from the Chinese experience, such as reducing administrative intervention and making the construction market play a decisive role.Originality/valueThis study provides some new empirical evidence to enrich the overall body of knowledge on growth theory, especially in promoting TFPG and TFPGC.

Journal

Engineering Construction & Architectural Management – Emerald Publishing

Published: Oct 20, 2020

Keywords: Construction industry; Total factor productivity growth (TFPG); 2008 financial crisis; Lessons

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