Abstract
In this paper, we use the method of combining parameter method with the non-parametric method to construct the production function of industry in China. Firstly, we make use of method of data envelopment analysis (DEA) to observe industry output efficiency in China. At the same time, we process the data by DEA and determine the DEA efficiency DMU and the DEA inefficiency DMU. Secondly, we put forward a kind of summation exponential production function with the analysis of Cobb-Douglas production function. This model could describe complex production process. At last, we estimate the new kind of production function using two stages DEA-regression method and this function responds to the definition of economics. On this basis, we analyze the industry output efficiency in China empirically.
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