Research on China’s “Lewis Turning Point” and Efficiency Analysis of Each Province—Based on DEA and SFA Methods

Abstract

Based on the current situation of China’s labor market, this paper studies whether China crosses the “Lewis Turning Point” in 2009-2017. Research shows that China has not yet entered the “Lewis Turning Point”. This paper uses the marginal productivity of labor as the criterion for judging the problem and calculates the capital stock through the perpetual inventory method to further estimate the production function and the marginal productivity of labor. Although China has not entered the “Lewis Turning Point”, due to the heterogeneity between cities, some cities may have entered the “Lewis Turning Point” in advance. This paper further analyzes the provinces of China and uses DEA and SFA methods to analyze the efficiency of capital stocks and labor input in various provinces. The results show that some cities are inefficient due to excessive labor input. China can transfer labor through a reasonable labor policy, thereby avoiding labor shortages in some cities and ultimately improving the efficiency of resource allocation in each province.