| In the21stcentury, globalization and international corporations are pushing theworld economy into an ever-fast growing and complicated situation. Neo-classicalTrade Theory and New Trade Theory fail to explain the formation mechanism of thedifferences in cost, factor scale, technologies and diamond factor for disparateeconomic entities. Neo-institutional Economics lay emphasis on interpretingeconomic growth institutionally, while the relationship between institutional changeand competitive edge in international trade is overlooked. What’s more, the depth,range and intensity of international trade are changing from time to time, so thesource of competitive edge in international trade becomes a vital point to be inquired.For this purpose, this paper elects the relation between variation of institutionalquality and discrepancy of competitive edge in international trade as the theme of theresearch, hoping to identify the ultimate source of competitive edge in internationaltrade and the causal connection between institutional quality’s discrepancy anddifference of competitive edge in international trade. It is of significant theoreticaland practical meaning to probe into disclosing the internal mechanism and acting pathof how the institutional innovation may affect the competitive edge in internationaltrade.On the basis of both defining the concept of institutional quality, institutionalinnovation, competitive edge in international trade and international tradecompetitiveness and analyzing the internal structure and basic functions of theeconomic system architecture, the paper constructs a relational model involvesinstitutional quality and international trade competitive advantage to explore theimpact mechanism and pathway of institutional quality and innovation oninternational trade’ competitive advantage from two perspectives of theoreticalderivation and mathematical proof respectively, and builds a comprehensiveeconometric model and evaluation index system to evaluate the institutional qualityand international trade competitiveness in the round. By selecting empirical data from33major trading countries dating from2004to2010, the paper calculates thecomposite index of institutional quality and international trade competitiveness. Astructural equation model and a multivariate panel data model are designed so as tomake a multi-angel and multi-level empirical test about the impact of institutional quality on international trade competitiveness. Finally, according to the theoreticalanalysis and empirical results, preliminary ideas are proposed.1. The paper creates a framework of theoretical model, which can systematicallyanalyze the influences of institutional quality and institutional innovation oncompetitive advantages in cost of international trade, efficiency and innovation andreveal its endogenous relationship:(1) On the premise of fixed physical and chemicalcosts in the production process, corporations’ profit optimization strategies and otherunchanged conditions, the average transaction cost of export products is a strictlydecreasing function on institutional quality. Under the same division scale, the systemimprovement would reduce transaction friction, thus reducing the average transactioncosts per unit of product, which suggests that institutional innovation is an importantsource on competitive advantage in the cost of international trade.(2) when the keyparameters in the model using a range of reasonable the equilibrium value, theimprovement on institutional quality,will lead to greater production efficiency andincreased trade efficiency, meanwhile, transaction costs reduced greatly, whichshows that institutional innovation is also an important source on competitiveadvantage in international trade efficiency.(3) When the basic model is extended tothe research of an innovative team found that, under certain other conditions, divisionscale and innovative effects of high-tech products are a strictly increasing function ofinstitutional quality, which shows that institutional innovation is also an importantsource on competitive advantage in international trade innovation.(4）In a bilateraltrade world where institutional quality is different while other factors identical, whenthe division scale is constant, the country with better institutional quality has a lowertrading friction and higher degree on division of labor specialization and thus,specializes in producing and exporting complex products which have strongerdependence on system. And another country with worse institutional quality willmake the opposite choice. That Indicates the difference in institutional quality leadsto an endogenous structure between countries having comparative advantages, thus,forming trade pattern based on comparative advantages of institutional qualitybetween trading countries.(5) When the model is extended to a dynamic generalequilibrium framework analysis under the context of an open economy with constantother factors, institutional innovation will reduce trading friction of division,improve the specialization in division of labor, thereby enhance competitiveness ofexporting complex products which have stronger dependence on system insystem-innovative country. While the country with curing system is forced to choose simple production and exports which are weaker system-dependent and mayfall into dumping with low prices. Furthermore, the whole world, on the basis ofchanges in institutional quality, forms a new international division of labor andmarket equilibrium.(6) When institutional quality is constant, the transaction frictionand specialization in division of labor are into a positive relationship. So, with theexpansion on division scale, companies will be constrained by trade friction, whichprovides a better explanation why companies choose outsourcing or external markettransactions.2. The paper structures comprehensive evaluation index systems of institutionalquality and competitiveness on international trade.(1) It formulates a comprehensiveevaluation index system of institutional quality that is consisted of property system,enterprise system, market system, government management system and foreigneconomic and trade system. It designs a comprehensive evaluation model and methodaim at measuring institutional quality overall, which overcomes the shortages ofprevious institutional evaluating indexes that are merely single or partial institutionalindicators.(2) The dissertation firstly applies core indicators which reflect newcompetitive advantage of export to the unified evaluation framework oncomprehensive competitiveness of international trade, and structures a comprehensiveevaluation index system of competitiveness on international trade, which consists ofexport structure, export quality, export efficiency, export innovation, export benefitand export scale. And it designs a comprehensive evaluation model and method aim atmeasuring competitiveness of international trade overall and successfully overcomesthe limitation of measuring international trade’s competitiveness that some singleindicators such as export scale and market share stressed on previous papers.3. The dissertation creates a positivism paradigm to describe in what way themulti-level institutional system would influences the comprehensive competitivenessin International trade.(1) The dissertation designs a multi-level structure equationmodel to empirically test the effect of economic institutional system on internationaltrade competitiveness. The different influence of different hierarchy are as follows: asfor the export competitiveness, the influence of property rights system is strong, theinfluence of foreign trade and economic cooperation system is weak, and the otherhierarchy’s influence is of moderate level; as for the export scale, the comprehensiveinfluence of hierarchy is the strongest, followed by export innovation, exportefficiency, export structure, export quality and export surplus. These results make upthe shortage of previous literature using a single system of indexes in empirical analysis;(2) The paper takes principal factors and institutional variables into themulti-factor panel data model for empirical analysis and the results imply that theinfluence of the above factors on trade competitiveness is different: as for thosehighly opened countries, the influence of different institutional quality and factorscost on export competitiveness is strong; as for those less opened countries, theinfluence of natural sources is strong, while that of technological disparity and scaledisparity is weak，which go in line with the theoretical hypothesis above.Not only do the above research provides demonstration and support for theapplication of New Institutional Economics to international trade, it also reveals thenew source of enhancing the export competitiveness from perspectives of institutionalquality and institutional innovation. It expands the research field of the NewInstitutional Economics, compensates the shortage of traditional theory and providesa new theoretical interpretation and evidence for the difference and enhancement ofexport competitiveness among countries. As a result, the theoretical system isenriched. |
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