Research On Chinese Trade Interests Chains And Trade Structure Optimization Under The Division Of Global Value

In the past thirty years,with the low factor costs and continuously decreasing transaction cost,China's manufacturing industry engaged into the global value chain(GVC)dominated by the multinationals.through processing trade.By undertaking labor-intensive,low-tech processing,manufacturing or assembly,China has achieved rapid growth in trade and manufacturing.However,with the recent appreciation of the RMB exchange rate,a sharp rise in factor costs,decrease the carrying capacity of the environment as well as the combined effects of the financial crisis and a series of factors,such positioning in the "GVC bottom" pattern of trade can't be sustainable.At the same time,the academic study of GVC deepens gradually,and the decomposition of the benefits of international trade becomes more precise and systematic.In this context,this paper researches on the allocation of trade welfare and the path of the GVC transformation and upgrading from the angle of value added trade with the theoretical and practical significance.On the basis of summarize,organize and comments on the existing literature,this paper uses "GVCs participation index","length of GVCs" and other core indicators to locate China's position and role in the GVCs.It suggests that:In the past 15 years,the depth and breadth of China's participation in GVCs has been developed rapidly;China mainly participates the international division by the manufacturing sector and locates in the lower end of the GVCs.Secondly,this paper establishes the a north-south value added trade model and discusses the determinants of trade interests on basis GVCs.It get two fundamental propositions.first,skill-abundant countries will get more national trade interests relative to the skill-scare countries;second,GVC division will solidify the existing pattern of income distribution.Thirdly,this paper discusses the interests China explored from GVC trade from both static and dynamic perspective.In terms of static trade interests,this paper explores the DVA embodied in gross exports,China's actual trade balance and industrial competitiveness based on value added.It found that the China's ratio of DVA embodied in gross exports decline in volatility,the DVA capacity is weak,and there are considerable benefits to be obtained by foreign countries.After re-estimated the value added trade balance between China and its trading partners,we find that China's trade with the United States and other developed countries are overvalued,which revealed that the roots of trade friction between China and Europe is the GVC trade patterns.This paper estimates the RCA based on value added and found that the international competitiveness of Chinese traditional labor-intensive industries declined,indicating that China's labor advantage is losing.Facing the disappearing of"demographic dividend",China needs to adjust relevant trade policies.In terms of dynamic trade interests,this paper examines the impact of GVC trade in employment,income distribution and technological progress.It found that:China's employment and foreign capital inflows are closely related;China involved in the value chain division mainly with low-skilled labor,and thus the GVC division has positive effect on China's technological progress,there are"quality ladder" of high-tech products between China and developed countries.Subsequently,on the basis of the theoretical model,this paper using GMM method to test 40 countries(including China)panel data both at the national level and industrial level in 1995?2010.Econometric model results support the two propositions of theoretical model.The results of theoretical analysis and measurement test can be considered:The reason why China in the low-end of GVC is mainly because of the relative scarcity of skilled labor and lack of R&D investment;In addition,China subordinate position in the global production network is also had a negative impact on the DVA embodied in gross exports.At last,this paper points out that:the major risk of participation in GVCs is the low-end trade structure,the resulting trade friction pressures and environmental burden.Therefore,China needs to break through the "low end locked" in GVCs and optimize its trade structure,thus to change the disadvantage of trade interests distribution under the global value chain,which essence is how to increase value-added products.After those analyses,the paper gave some relevant recommendations on how to optimize China's trade structure.