Technological Progress, Technical Efficiency & Productivity Growth of Modern Service Industry: An Comparative Study on Yangtze River Delta and Pearl River Delta

Using Malmquist index, this paper measures total factor productivity (TFP) of modern service industry in Yangtze River Delta and Pearl River Delta during 2000-2008, analyzes the sources and trends of TFP growth. Conclusions are made as follows: TFP of modern service industry grew rapidly and had a downward trend in the two zones, and the source of economic growth has shifted from technical efficiency to technological progress. Modern service industry in Pearl River Delta was less dependent on investment and had higher TFP index and smaller internal differences than that in Yangtze River Delta. TFP differences between the two zones were mainly due to the differences in technological progress, which was higher in Pearl River Delta than in Yangtze River Delta.