Recent Productivity Trends in China: Evidence from Macro- and Firm-Level Data

Using macro- and micro-level data, this article examines China’s productivity growth slowdown after 2007. The authors find that strong investment in infrastructure housing led to lower returns capital. Firm-level evidence suggests limited market entry exit a lack of resource allocation more productive firms were associated with slower manufacturing total factor (TFP) growth. Earlier reforms had convergence between state-owned private companies, but process stalled potential remains high, its long-term prospects depend on reversing the decline TFP