Productive capital stock estimates for China's industrial sector: Results and discussion

Capital stock is a key and indispensable variable in production analysis. However, there exist many problematic capital stock estimates in the previous studies due to the inappropriate capital stock concepts. This paper attempts to construct a series of capital stock for China's industrial sector with an appropriate concept. We discuss the statistical problems in detail and solve them with great caution. Then, upon the reliable and comparable investment data, we estimate a set of productive capital stock for industrial sector based on the OECD recent published manual - Measuring Capital, 2
^nd
edition. We discuss the sensibility of our new estimates with two more different initial capital stock choices, and also compare our estimated productive capital stock with the existing capital stock estimates.