Analysis of China's Economic Growth Drivers: An Empirical Study Based on an Extended Cobb-Douglas Production Function (2010-2022)

Abstract

This study uses numbers to look at what caused China's economy to grow from 2010 to 2022. It does this by building an extended Cobb-Douglas production function that includes measures for the digital economy and quality-adjusted labor force. The study shows that the capital-output elasticity dropped significantly, from 0.42 in 2010–2015 to 0.35 in 2016–2022. The contribution rate of total productivity (TFP) rose from 18% to 26%, with the digital economy making up 40% of that. Regional analysis shows that the coastal regions have been driven by innovation (± ≈ 0.31), while the inland regions still have a capital-dependent model (± ≈ 0.43). This study's method is new because it uses both migrant workers monitoring data and digital economy proxy indicators. This gives a more accurate picture of how labor quality and technology progress affect each other. The study results show that China's economy has changed from being based on investments to being based on innovations. They also have policy implications for promoting high-quality development.