Characteristics and Evolutionary Laws of The Factor Structure of China’s Entire Industry

Abstract

Based on clarifying the boundaries of production factors such as labor, land, technology, and capital, this study constructs an industrial factor structure measurement model using an extended C-D production function and input-output analysis. Using panel data of regional total output and factor inputs from 31 Chinese provinces during 2003-2020, along with input-output tables from 2005-2020, the study measures China's overall industrial factor structure at average social production levels from 2005 to 2020.

Analysis of China's industrial factor structure from 2005 to 2020 reveals strengthened labor dominance, weakened technological contribution, land contribution shifting from negative to positive, and overall stable capital contribution. The findings indicate that the substitution and complementary effects among factors are multi-dimensional, dynamic, and non-linear. These interactions drive the dynamic rebalancing of factor structure, while technological innovation emerges as the driving force for China's high-quality sustainable economic development.

Based on these research conclusions, the study proposes policy implications including: strengthening support policies for technological innovation, developing innovative factor allocation and industrial upgrading policies, and introducing policies for innovative international technological cooperation and competition. These suggestions aim to provide reference for formulating China's high-quality sustainable economic development strategy.

The analysis demonstrates that the substitution and complementary relationships between factors are characterized by multi-dimensional, dynamic, and non-linear properties, driving the dynamic rebalancing of factor structure. Furthermore, technological innovation has become the source of power for achieving China's high-quality sustainable economic development.