The Effect of Value-Added Tax on Total Factor Productivity Based on Stochastic Frontier Analysis——A Comment on Improvement of China’s Value-Added Tax System
JIANG Yan-feng1,JIANG Yan-fang2
1.Shanghai Maritime University, School of Economics and Management, Shanghai 201306, China;2. South China Normal University, Institute of Public Administration, Guangzhou510006, China
Abstract：
This paper adopts the method proposed by Kumbhakar and Lovell(2000), decompose total factor productivity into technical efficiency, technology progress efficiency and scale efficiency, based on stochastic frontier model and using the translog production function, this paper analyses the relationship between the proportion of value added tax and each component of total factor productivity according to China’s 29 provinces’ data in 1994-2011.The results show, impact of China's value-added tax on total factor productivity is complex, The increase of the proportion of value added tax can improve technical efficiency, but is not conducive to the technology progress efficiency and scale efficiency. Finally, according to the results of empirical analysis and effect of VAT expansion policy, when further improve the value-added tax system, policy makers should pay more attention to its influence on total factor productivity, For example, expand scope of offset for value-added tax on technology research and development, exert adjustment effect of value-added tax on the specialized division of labor.
JIANG Yan-feng,JIANG Yan-fang.The Effect of Value-Added Tax on Total Factor Productivity Based on Stochastic Frontier Analysis——A Comment on Improvement of China’s Value-Added Tax System[J] Economic Survey, 2016,V33(4): 103-108
2016 
