Analysis Of The Influence Of Japanese Direct Investment On Sino-Japan Intra-industry Trade

With the development of economic globalization, today's international trade can be divided into two types:inter-industry trade and intra-industry trade. The intra-industry trade refers to one country imports and exports goods of the same industry. The development of intra-industry trade can promote the economic development of one country. It can expand a country's producer effect and consumer effect, promote technological progress and upgrade the industrial structure. It still can make a country gain new trade advantage, improve trade competitiveness and avoid trade friction. Many factors can influence intra-industry trade. With the development of economic globalization, international direct investment greatly promotes the various countries'economic development, and multinational company's internal trade has gradually become an important source of intra-industry trade. International direct investment has become a more and more important influence factor of intra-industry trade.Since the reform and opening up, China and Japan's bilateral trade development is rapid, Japan is China's third largest trading partner, simultaneously is China's second largest foreign investor. Sino-Japan intra-industry trade development is so rapid that it is very important to study how Japanese direct investment influence China and Japan intra-industry trade. This paper analyzes the relationship between Japanese direct investment and Sino-Japan bilateral intra-industry trade, explore the different influences of direct investment on horizontal intra-industry trade and vertical intra-industry trade, and based on this comes up with policy advices.This paper firstly puts forward the meaning of improving and developing Sino-Japan intra-industry trade, especially horizontal intra-industry trade and emphasizes the necessity of studying and developing Sino-Japan intra-industry trade. Then this paper expounds how direct investment influences intra-industry trade, including direct influence mechanism and indirect influence mechanism, and finds the relationship between Sino-Japan intra-industry trade and Japanese direct investment from the overall scale, product features and trade and investment types. Finally, this paper uses the econometric model to analyze Japanese direct investment's influence on different types of intra-industry trade, namely vertical intra-industry trade and horizontal intra-industry trade, and then puts forward the policy suggestions about how China attracts Japanese direct investment better to improve the development of Sino-Japan intra-industry trade in our country and promote the upgrading of our country's industrial structure.This article has several features:first, the paper studies the influence of foreign direct investment on intra-industry trade specific to Japan, which is more meaningful and realistic for studying how to attract Japanese investment to promote intra-industry trade development. Secondly, the paper divides intra-industry trade into vertical intra-industry trade and horizontal intra-industry trade, and analyzes the influence of Japanese direct investment on vertical intra-industry trade and horizontal intra-industry trade respectively, which has an important practical significance to promote the transformation of intra-industry trade structure and the upgrading of our country's industrial structure. But because the author's theoretical level is limited, the research on the foreign direct investment's influence mechanism on intra-industry trade is not sufficient, which is still referenced by predecessors theoretical research results, In the empirical analysis, explanatory variables introduced in the measurement model are small and other influencing factors may be overlooked.