THE RELATIVE IMPORTANCE OF EFFORT, ORGANIZATION, AND TECHNOLOGICAL CHANGE IN CHINESE FACTORIES
Production reports from a set of Chinese factories reveal very rapid productivity growth from 1980 to 1991. To understand the underlying factors, the effects of work effort and labor organization are separated from the productivity estimates. Data analysis reveals that these two effects jointly explain most of the measured productivity growth during this period. This result suggests that (1) very substantial productivity growth can be realized for economies in the take-off stage even without substantial pure technological advancement, and (2) in reforming the Chinese state factories, there will have to be a more difficult second stage to confront their technological backwardness. Copyright 2001 Western Economic Association International.
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