Quantitative Analysis of Contribution Rate of Institution to Growth of Economy

Traditional theory suggests that the economic growth depends on capital, labor and other factor inputs and the progress of technology, which overlooks the factor of institution. Actually, under the condition of absence of factors increased and no change of technology, the improvement of productivity and the growth of economy can be achieved through the innovation of institution. This thesis tries to establish the institutional factor and then bring it to the production function, so as to quantify the contribution of the change of our industrial economic institution to the growth of industrial economy.