Aquatic Product Processing Industry's Total Factor Productivity and Influencing Factors in China

Abstract

This paper studies the TFP (total factor productivity) of China's aquatic product processing industry, which is estimated and decomposed by using OP (Olley and Pakes) method based on Chinese Industrial Enterprises Database from 2005 to 2013. Then this paper discusses the characteristics of TFP from the microscopic point of view, and finally analyzes the factors that affect the change of TFP. The results indicate that: (1) The TFP differs remarkably as the sub-sectors, regions and ownership of firms vary: the TFPs of aquatic product frozen processing and aquatic feed manufacturing are the highest, the productivity of firms in inland areas is higher than those in coastal areas and the productivity of private firms is the highest, followed by foreign-funded firms and state-owned firms. (2) Growth within firms contributes the most to the TFP growth, and resource allocation is inefficient among firms. (3) Labor productivity, firm size, export, FDI (foreign direct investment) and R&D can effectively promote the improvement of TFP in the aquatic product processing industry, and capital intensity and financing constraints will inhibit the industry from improving its TFP.