Study On Comparative Advantage Interests Of China’s Forest Products Trade

Study on comparative advantage interests of trade is the important issue of academic research. Most of the literature on this topic studies the effects on exporters’ forest resource under the assumption of single output price distortion. In reality, forestry sector is a sector with multipal output prices distortions in the context of economic transformation. Distortion implies departure from Pareto optimality. There are intersectional factor misallocations in the presence of multi-distortions. In the open economy, trade will induce intersectional factor reallocation. Trade can alleviate or aggravate misallocations, bringing efficiency gains or inducing efficiency losses. How to put the reallocation function of trade into full play in the transformation stage? How to improve comparative advantage interests of trade in the log run? This study aims at revealing the mechanism how the comparative advantage interests of trade are distorted and exploring ways to improve comparative advantage interests.According to the unique factor endowment structure and institution restriction in China’s early stage of economic transformation, this study reveals the mechanism how the comparative advantage interests of forest products trade are distorted from both the theoretical and the empirical dimensions, and reveals the key role of environment resource and forest resource dynamics in the reallocation function of trade. Then this study explores ways to improve comparative advantage interests of trade. This study investigates the effects and mechanisms of changes in the value of negative production externality on comparative advantage interests of forest products trade. Finally, this study reveals the mechanism of the positive interaction between the growth of trade profits and the development of domestic forest resource, and puts forward suggestions.The creative explorations of this study are as follows:1. This study reveals the mechanism how the comparative advantage interests of forest products trade are distorted in the context of economic transformation. This study quantitively proves the TFP enhancing effect of factor reallocation induced by trade. This study reveals the key role of environment resource and forest resource dynamics in the reallocation function of trade, providing solutions to put the reallocation function of trade into full play.2. This study investigates the effects and mechanisms of changes in the value of negative production externality on comparative advantage interests of trade. This study investigates the quantity effects if the value of negative production externality in plywood sector declines during2016-2025. It reveals that the TFP effect and the output-input price effect are contributing factors to the improvement of comparative advantage interests of trade, and illustrates that the output-input price effect is the main driving force, As an exploration in research method, this study employs the dynamic computable partial equilibrium model to the quantity analysis.3. This study reveals the mechanism of the positive interaction between the growth of trade profits and the development of domestic forest resource. The process of the establishment of the positive interaction is the process that the comparative advantage interests of trade is enhanced, and the process that trade provides sustainable economic incentives for the development of domestic forest resource. With the implementation of forest tenure reform, more and more households engage in forest cultivation. It is an urgent task for us to provide sustainable economic incentives for forest cultivation. Boosting the sustainable management of domestic forest resource with economic incentives from forest products trade is also inspiring for other countries with forestry potentials.