Abstract:
The growth of TFP is an important issue of macro-economics. By using Bayesian Averaging of Classical Estimates (BACE)approach,this paper introduces model uncertainty to classify and order all potential explanatory variables of TFP according to their explanatory ability after thousands of regression. The main conclusions are as follows: Of 16 ex-given potential explanatory variables,degree of FDI entry,importation dependence,exportation dependence,human capital level,neighbor region's TFP,the mature degree of market are the most important and robust variables. Another four variables-volume of FDI,import volume,export volume,and former R&D investment also have some explanatory ability. But,their effects on east,middle and west China are different.