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Sectoral Heterogeneity and the "Dual" Structural Change in China

Author

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  • Shan Pan

    (Institute of Industrial Economics, Jinan University)

Abstract

This paper develops a dynamic growth model with two industries and three sectors. This model characterizes the "dual" economic transition from the agriculture to the non-agriculture sectors and from the state to the nonstate sectors during the past thirty years in China. This model also proposes sectoral heterogeneity as the source of dual structural change, which reflects in factor income share between the agriculture and non-agriculture sectors while reflecting in technological progress between the state and nonstate sectors. In addition, there is nonbalanced sectoral growth in the Balanced Growth Path (BGP). Finally, we calibrate our model using data from 1978 to 2011 in China. Numerical simulation verifies the fitness of the model to the real data.

Suggested Citation

  • Shan Pan, 2019. "Sectoral Heterogeneity and the "Dual" Structural Change in China," Annals of Economics and Finance, Society for AEF, vol. 20(1), pages 413-436, May.
    • Handle: RePEc:cuf:journl:y:2019:v:20:i:1:pan
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    References listed on IDEAS

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    More about this item

    Keywords

    Dual structural change; Sectoral heterogeneity; Elasticity of substitution; Nonbalanced growth;
    All these keywords.

    JEL classification:

    • E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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