The Effect Of International Spillovers On Intra-product Specialization Of Chinese Manufacturing

With the rapid rise of information technology and the decline in transportation costs,as well as the worldwide liberalization of trade and investment,a modern international intra-product specialization system which bases on the decentralized production has provided Chinese manufacturing an opportunity to utilize comparative advantage to participate in international intra-product specialization and to utilize knowledge spillovers in global production networks for self-development.This paper comprehensively analyzes the status of Chinese manufacturing industry's participation in international intra-product specialization from the perspective of status and degree of international intra-product specialization.Therefore,this paper clarifies the obstacles to the improvement of Chinese manufacturing in the international intra-product specialization and the obstacles to the transformation of international intra-product specialization participation model,by which this paper enables China to seize the opportunity of the reconstruction of the international intra-product specialization in a complex international environment,break through the blockade of developed countries,construct a self-dominated value chain and gain greater profitability in global production networks.FDI and import trade are the main channels for China to participate in the international intra-product specialization,as well as the main channels for China to obtain international knowledge spillovers in global production networks.As an important external path to promote the technological progress of Chinese manufacturing industry,international knowledge spillover is one of the important driving forces for improving the status and participation degree of Chinese manufacturing industry in the international intra-product specialization.However,the effect of international spillover is constrained by the channel and path,and national absorptive capacity.Therefore,it is important to study the impact of international knowledge spillovers from different channels and paths on Chinese manufacturing industry's participation in the international intra-product specialization,fully release the cross-border production factor flow dividends,rationally open the structure to the outside world,and take advantage of opportunities for changes in the international division of labor structure to enhance the status of international intra-product specialization.First,there is a relative lack of related research on the effect of international knowledge spillovers of different channels and paths in the existing research on developing countries'participation in international intra-product specialization.This paper can more specifically analyze the existence and mechanism of different channels and paths of international knowledge spillover effects,and enrich the theory of international knowledge spillovers and the theory of international division of labor.Secondly,in the past,vertical spillovers only covered market-based spillover path,but lacked research on other spillover mechanisms.This paper uses the general knowledge flow of industries between similar technology structures as a mechanism to discover a new way of international knowledge spillovers,namely,technology-related effects.Finally,this paper divides the international knowledge spillover into two channels(import trade and FDI),as well as four paths(horizontal spillover,forward-related,backward-related,and technology-related).It analyzes the effect of international knowledge spillovers of different channels and different paths on Chinese manufacturing on international intra-product specialization.by which,this paper not only comprehensively analyzes the heterogeneity of international knowledge spillover effects of different channels and paths,but also excavates the most favorable channels and approaches for international knowledge spillovers,providing a basis for proposing targeted policies.The main conclusions are as follows:Firstly,through competition and demonstration effects,the horizontal international knowledge spillovers of the FDI channel promotes the status of international intra-product specializationof Chinese manufacturing.And technology-related effect also promotes the status of the international intra-product specialization.However,both backward-related and forward-relatedeffects hinder status of international intra-product specializationin Chinnese manufacturing.As a result,it is difficult for upstream enterprises in China to obtain core technology spillovers from FDI enterprises.And downstream enterprises are limited into assembly and processing links.The horizontal spillover of international knowledge of import trade channel promotes the status of international intra-product specialization in Chinese manufacturing.Paticpating in to the global production network by the comparative advantages of the labor force,Chinese manufacturing can quickly acquire the technology in imported products through imitation and "reverse research and development",by which Chinese manufacturing realizes the technology process.The vertical spillovers of import trade channelalso promotes the status of international intra-product specialization.Allover,international knowledge spillovers from import trade channel benefits the improvement of international intra-product specialization in Chinese manufacturing through diversified channels,and it is more important driving forces for Chinese manufacturing industry to increase its profitability.Secondly,the effect of FDI channel of international knowledge spillover hinders the deepening of high-end segment in the international intra-product specialization.The hirozental international spillovers of import trade channel promotes the participation in the high-end segment of the international intra-product specialization.While market-based spillovers are characterized by "asymmetricity":the backward-related effect increases the degree of high-end segment participation,however,forward-related effect decreases it,while technology-related spillover is not significant.Due to the global value chain is dominated by multinational companies,they restrict the import of key technologies from the core segment to China,by which,multinational companies prevent China from actively importing upstream high-tech intermediate products to enhance the production capacity,and attempt to restrict China to assembly and processing through trade means.The spillover effect of international knowledge in import trade is manifested in deepening the participation of China's high-end manufacturing sector.Therefore,as one of the driving forces for China's participation in the structural adjustment of the international intra-product specialization,the international knowledge spillover of import trade channel is more favorable.Thirdly,the overall manifestation of international knowledge spillovers of FDI channel is to inhibit the low-end participation of international intra-product specialization in Chinese manufacturing.Among them,the horizontal effect and backward-related effect reduces the degree of foreign dependence on Chinese manufacturing exports,reduces the proportion of foreign value in exports,and reduces the impact of Chinese manufacturing industry in the international intra-product specialization.However,the entry of efficiency-seeking FDI based on the processing trade model strengthens the control of the manufacturing sector in China,and the forward-related effect solidifies the low-end participation model of Chinese manufacturing.The horizontal international spillover effect of import trade deepens the low-end participation,indicating that trade model based on processing trade solidifies the mode of passive participation of Chinese manufacturing in the international intra-product specialization,which causing " Low-end dilemma".The vertical spillover effect of the import trade channel under the related mechanism helps Chinese manufacturing industry to get out of the low-end dilemma.Fourthly,the absorptive capacity of Chinese manufacturing has a regulating effect on the international knowledge spillover effect,but there is still a problem of insufficient capacity to cross the threshold.Importing advanced technology or equipment for "reverse research and development" is one of the reasons for China's technological progress.Increasing the ability to absorb international knowledge spillovers can enhance the international intra-product specialization in international manufacturing.At the same time,compared with FDI enterprises,Chinese enterprises' technological level is low.The excessive technological gaps have hindered the absorption and utilization of knowledge spillovers.Therefore,increasing human capital and R&D investment,as well as China's manufacturing technology level,is conducive to improving China's manufacturing absorption capacity and promoting international knowledge spillovers.Fifth,among the study of the impact of international knowledge spillovers on the status and degree of i international intra-product specialization in Chinese manufacturing,the"infection" and "competition" effects of technology-related spillovers are also significant vertical international knowledge effect.Based on technology-related spillovers,international knowledge spillovers have a significant effect on improving the status of high-end sector participation degree of international intra-product specialization,and inhibiting the low-end participation degree of Chinese manufacturing industry,which plays an important role in preventing low-end locking".