Estimating Capital Formation and Capital Stock by Economic Sector in China : The Implications for Productivity Growth
This paper aims to fill a gap in the literature on capital formation in China by estimating the capital stock in four economic sectors: business, infrastructure, government, and housing. Such a breakdown is necessary for the purpose of analysis of...
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| Language: | English |
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World Bank, Washington, DC
2020
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| Online Access: | http://documents.worldbank.org/curated/en/846601594661216544/Estimating-Capital-Formation-and-Capital-Stock-by-Economic-Sector-in-China-The-Implications-for-Productivity-Growth http://hdl.handle.net/10986/34126 |
| Summary: | This paper aims to fill a gap in the
literature on capital formation in China by estimating the
capital stock in four economic sectors: business,
infrastructure, government, and housing. Such a breakdown is
necessary for the purpose of analysis of economic
development in China, as the normal models of economic
development are based on a competitive economy, which is
clearly not the case for the country's infrastructure
and government sectors. Moreover, the contribution of
housing to gross domestic product in China is very poorly
measured. Although the results of this analysis can only be
approximate, as the required detailed information for a
better estimate is not published, they nonetheless suggest
that there has not been overinvestment in the Chinese
business sector -- its capital-output ratio has risen only
slightly over the past 40 years. Yet, there have been surges
in the stocks of housing and infrastructure in the past
decade. These sectors account nearly all the recent increase
in the capital-output ratio in China. |
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