Growth Characteristics and Impacting Factors of the Total Factor Productivity in the Construction Industry

Abstract:

Comprehensively using the Data Envelopment Analysis (DEA) based Malmquist index method, the β convergence testing model and the grey relational analysis process, this paper establishes a framework for measuring the total factor productivity (TFP) growth index as well as analyzing the growth convergence and related impacting factors, and uses the framework to empirically investigate the growth characteristics and impacting factors of TFP growth in the Chinese construction industry during the period 1993—2012. The findings show that the average annual TFP growth rate during this period is 4.6%, which is principally driven by the technological change, and that the technological efficiency does not increase substantially. It is also shown that there are significant differences among the changes of TFP during different sub periods. The growth rate reaches its highest level during the period 2004—2007, and then gradually decreases. β convergence tests indicate that there are significant convergences among the TFP growths in the national wide and eastern and central parts of China. The convergence of TFP growth in Western China, however, is not found to be significant. Factors in the areas of economic environment, industry research and technology capability, and industry structure could influence the growth of TFP, and the output percentage index of foreign funded construction enterprises is found to possess the highest grey relational grade with the TFP growth index.