Inspiration vs. Perspiration in Economic Development of the Former Soviet Union and China

when 2015
who Bas van Leeuwen

Dmitry Didenko

Péter Földvári

what journal Economics of Transition
what paper Inspiration vs. Perspiration in Economic Development of the Former Soviet Union and China (ca. 1920–2010)
language English

involved project member(s)

Bas van Leeuwen Peter Foldvari
   

We thank Stephen Broadberry, Kyoji Fukao and other participants of the Productivity session of the 2012 Asian Historical Economics Conference held at Hitotsubashi University; their contributions to the discussion helped to improve this paper. The authors are also grateful to an anonymous referee for useful advice and suggestions. The findings, interpretations and conclusions are the authors’ own views, which are not necessarily shared by the institutions with which they are affiliated. The authors accept full responsibility for the contents of the paper, including possible errors and omissions. This paper was supported by the Fundamental Research Fund for the Central Universities in China (Jinan University).

abstract

Here, we discuss the role of both perspiration factors (physical and human capital) and inspiration factors (Total Factor Productivity) in the economic development of the Former Soviet Union area (FSU) and China, ca. 1920–2010. Using a newly created dataset, we find that during the Socialist central-planning period, economic growth in both countries was largely driven by physical capital accumulation. This finding follows logically from the development policies in place at that time. During their transition periods, (i.e., starting from the late 1970s in China and the late 1980s in the FSU), China managed to keep technical inefficiency of production factors in check, largely by massively increasing its human capital, thereby lowering the physical-to-human capital ratio. In contrast, the FSU accomplished a similar outcome largely through reducing its stock of physical capital. As a result, although there was little difference in technical efficiency between these two economies, China’s emphasis on human capital formation made it easier for this country to improve its general productivity and to increase per capita growth. This changed in the late 1990s and early 2000s, when the FSU began to recover economically, regaining its 1990 levels of output and productivity.

keywords

Physical capital,human capital,productivity,technology,economic development,Socialism,USSR ,China

link to paper page of the journal website

http://onlinelibrary.wiley.com/doi/10.1111/ecot.12060/full

citation format

MLA Leeuwen, Bas, Dmitry Didenko, and Péter Földvári. “Inspiration vs. perspiration in economic development of the Former Soviet Union and China (ca. 1920–2010).” Economics of Transition 23.1 (2015): 213-246.
APA Leeuwen, B., Didenko, D., & Földvári, P. (2015). Inspiration vs. perspiration in economic development of the Former Soviet Union and China (ca. 1920–2010). Economics of Transition, 23(1), 213-246.
Chicago Leeuwen, Bas, Dmitry Didenko, and Péter Földvári. “Inspiration vs. perspiration in economic development of the Former Soviet Union and China (ca. 1920–2010).” Economics of Transition 23, no. 1 (2015): 213-246.
Harvard Leeuwen, B., Didenko, D. and Földvári, P., 2015. Inspiration vs. perspiration in economic development of the Former Soviet Union and China (ca. 1920–2010). Economics of Transition, 23(1), pp.213-246.
Vancouver Leeuwen B, Didenko D, Földvári P. Inspiration vs. perspiration in economic development of the Former Soviet Union and China (ca. 1920–2010). Economics of Transition. 2015 Jan 1;23(1):213-46.

Human Capital in Republican and New China: Regional and Long-Term Trends

Economic History of Developing Regions

when 2017
who Bas van Leeuwen
Peter Foldvari
Li Jieli
what journal Economic History of Developing Regions
what paper Human Capital in Republican and New China: Regional and Long-Term Trends
language English

involved project member(s)

Bas van Leeuwen Peter Foldvari Li Jieli

abstract

In recent decades it has been debated whether China’s growth performance is primarily driven by capital accumulation (more inputs) or rather by an increase in Total Factor Productivity (TFP) growth (better technology and institutions). The answer to this question may offer a glimpse into the future trends of China’s economic growth. If the perspiration factors are dominant, one should expect a slowdown in the growth of the Chinese economy in accordance with the traditional Solow model. If, however, TFP growth drives per capita GDP growth, one can expect a strong convergence of China toward the technological frontier. In this paper we combine historical, long-term analysis with quantitative methods to find out whether the effect of (both human- and physical) capital and TFP on growth changed over the last 90 years. While partly relying on existing data, lack of information required us to estimate a new dataset on human capital for the provinces of China between 1922 and 2010 which allows us to decompose the observed economic growth into accumulation driven and TFP driven parts. We find that general technological development improved steadily over the course of the 1990s and 2000s.

keywords

Chinaeconomic developmenthuman capitaltechnology


citation format

MLA van Leeuwen, Bas, Jieli van Leeuwen-Li, and Peter Foldvari. “Human capital in Republican and New China: regional and long-term trends.” Economic History of Developing Regions 32.1 (2017): 1-36.
APA
van Leeuwen, B., van Leeuwen-Li, J., & Foldvari, P. (2017). Human capital in Republican and New China: regional and long-term trends. Economic History of Developing Regions, 32(1), 1-36.
Chicago van Leeuwen, Bas, Jieli van Leeuwen-Li, and Peter Foldvari. “Human capital in Republican and New China: regional and long-term trends.” Economic History of Developing Regions 32, no. 1 (2017): 1-36.
Harvard van Leeuwen, B., van Leeuwen-Li, J. and Foldvari, P., 2017. Human capital in Republican and New China: regional and long-term trends. Economic History of Developing Regions, 32(1), pp.1-36.
Vancouver van Leeuwen B, van Leeuwen-Li J, Foldvari P. Human capital in Republican and New China: regional and long-term trends. Economic History of Developing Regions. 2017 Jan 2;32(1):1-36.