Dynamic Comparative Advantage And Upgrading Of China's Foreign Trade Industries

Dynamic comparative advantage is in general developed on the basis of comparative advantage theory. It emphasizes the comparative advantage of a country is not necessarily the same, but over time may be the emergence of new comparative advantages. If the Government strengthens the investment in an industry, the industry is likely to change from a disadvantage in international trade to comparative advantage.The main difference with the general study of this paper is from the perspective of dynamic comparative advantages to study industrial upgrading in China's foreign trade. Measured by comparing the advantages of the industrial structure reflects the current status of China's foreign trade, while the forecast through the Markov matrix is proposed to achieve the conclusion that industrial is an important way to increase investment in technology-intensive industries, to develop their dynamic comparative advantage for upgrading in China's foreign trade industry.This article has drawn conclusions. The first one is that China could promote foreign trade industrial upgrading through developing the dynamic comparative advantage of high-tech industry. The second one is that the industrial structure of China's foreign trade trends to high level, industrial structure has improved. The third one is that the probability of high-tech industries to obtain comparative advantage is high, and the government should increase investment in high-tech industries. The last one is that foreign direct investment, R&D investment and GDP is the factor to promote the high-tech industry to gain comparative advantage.There is some advice based on the conclusions. Introduce more FDI. Develop Strengthen local enterprises'capability of independent innovation. Increase R & D investment. Promote economic growth and so on.