Study On Change Of Complementation Between Supply And Demand Between Inland Provinces And Regions And Costal Provinces And Regions And Its Effects To Inter-region Trade

Regional complementation between the supply and demand is an important precondition for inter-regional trade. Reasonable structure and full development of inter-regional trade have profound impact to continued healthy development of the national economy, the country’s overall competitiveness, the domestic industrial layout and the coordinated development of the regional economy.1992is known as the first year of China’s market economy. The paper thoroughly studies the complementation between supply and demand in the region during China’s market reform process. By statistics and analysis, the paper demonstrates the trend of industry and trade between inland and costal areas, and provides realistic basis for the risk management of China’s regional economic development, so this paper is of great significance to the sustained and rapid development the circulation industry and the region.Industry location theory and international and regional trade of western economics are the theoretical analysis tools of the paper.The location theory originated in the agricultural location theory, founded in1826by the German economist Johann·Tnunen. Subsequently, appear the theory of industrial location, gradient transfer theory the market location theory, anti-gradient promotion theory. The international and regional trade theory experienced stages as classical, neo-classical, New Trade and New Economic Geography trade theory. Classical and neo-classical theory assumes perfectly competitive market, stresses the mutual benefits of trade, and mainly explains the inter-industry trade. After World War Ⅱ, new trade theory emerged when the global trade developed, and the theory explains the phenomenon of inter-industry trade by imperfect competition, economies of scale and technological progress. New Classical theory explains the trade by specialization. The inter-regional trade is the basis of international trade, and they are with the same theoretical core, so a number of international trade theories can be directly used to interpret and analyze the phenomenon of inter-regional trade. These two major theoretical systems have had a major impact to China’s reform and opening up regional trade development strategy.The paper is divided into three levels and six chapters:The first level (Chapters1and2) is the theoretical basis of the paper, mainly explains the development of the industry location choice theory and trade theory, as well as its latest research progress, research ideas and methods, the overall framework and content arrangements. The second level (Chapters3and4) is the main body of the paper. It mainly analyzes the regional complementation between supply and demand by different aspects. The third level (Chapters5and6) focuses on problems and solutions. Through the above analysis, the paper concludes that the increase of complementation between supply and demand brings four positive impacts. The first is to promote the provinces and regions to form different product structures. The second is to not only save land resource consumption but also increase the supply of agricultural supply. The third is to enhance the production efficiency of the energy industry by inter-regional trade competition. The fourth is to promote the continued growth of trade and fast development of circulation industry. The increase of complementation between supply and demand also brings some negative effects. The first is the capacity constraints and high energy consumption and high emissions. The second is high logistics cost due to the long-distance transport of huge amount of low-value goods and imperfect operation and management. The third is the increase of trade deficit between west and east areas, which is not conducive to the development of inter-regional trade. Then the paper provides advice and solutions.The paper has the following innovations:1. This article reveals the four basic factors in formation of regional supply and demand complementation, and further improves theoretical framework of the supply and demand complementation. Regional supply and demand complementation in early research is mainly concentrated on factors like historical, natural resources and social resources, while lacks attention to complementation caused by industrial specialization. This paper analyzes that effective supply and demand can only be caused by industrial production and the economic and social development. Therefore, the system of economy, natural resources, the level of economic and social development and industrial specialization level are the basis of effective supply and demand. Industry, enterprise and capacity accumulate into some provinces and its supply ability increases and the complementation between provinces increases.2. This article studies the regional complementation of supply and demand from the macro, meso, micro dimensions and levels. By using the relative demand satisfaction indicators and the absolute demand satisfaction indicators, from the regional and provincial domain, and from industry meso dimension and product micro level, this article analyzes changes of the regional complementation of supply and demand in China’s market reform process especially to changes between the east, middle and western areas.3. Preliminary studies mainly focused on market segmentation, trade deficit between west area and east area and unequal exchange problem in inter-regional trade, while this article focuses on irrational high level of logistics costs and high energy consumption and emission caused by unreasonable inter-regional trade structure. This article points out that complementation between supply and demand between the inland and coastal provinces is increasing, which brings the following effects, like the sustained development of circulation industry, resource consumption saving, improvement of production efficiency and economic benefits, and increase of trade deficit between west area and east area. In order to solve the problems, this article provides five suggestions. First, to foster and develop large-scale inter-district circulation enterprises to promote the development of inter-regional trade; Second, to encourage inland provinces to extend the industry chain of raw material processing industry to improve and enhance the product structure; Third, to support and encourage private capital to enter the energy industry in inland provinces to enhance the supply capacity; Fourth, to vigorously develop high-performance integrated logistics system to reduce logistics energy consumption and emissions; Fifth, to promote inter-district transfer of industry and to speed up the development of key manufacturing economic zones in inland cities.This paper also has the following shortages which will be improved in future study. The first is that the classification of industry is too rough, the time for study is too short and the statistics are not enough. The second is the lack of analysis of the measurement of demand satisfaction.