A Study On The Influence Of Foreign Trade To Economic Growth In Zhejiang Province

Since the reform and opening up, Zhejiang Province achieved rapid economic development relying on its unique advantage, its GDP, and import and export volume for several years ranked fourth in the country, created a remarkable "Zhejiang phenomenon." Is there any necessary link between the rapidly growing economy and import and export? If foreign trade really has the promotion to the economic growth of Zhejiang Province, is it promote the economic growth by the effect of technology spillover of foreign trade? Or just rely on a simple increase in labor and capital investment to achieve? This question is very important to the sustainable development for economy and foreign trade in Zhejiang Province. Therefore, in-depth study the relationship of foreign trade and economic development in Zhejiang Province is of great theoretical and practical significance.Firstly, the paper began with foreign trade and economic growth from the theoretical analysis,the transmission mechanism of technology spillover effect of foreign trade analysis and review empirical studies in our countries and abroad, which laid the theoretical foundation and research methods for reference.Then the main part mainly through both qualitative and quantitative analysis to illustrate the interaction between foreign trade and economic growth in Zhejiang Province. Qualitative analysis: economic growth and, respectively, from Zhejiang Province, the total foreign trade characteristics, structural features(including the industrial structure, the main structure of import and export commodities, foreign trade terms and foreign trade nature) and regional characteristics(Including 11 places of the effects between foreign trade and their economic growth and the situation of import and export with the major countries) of the three aspects of analysis, concluded that: the import and export of Zhejiang Province can promote its economic growth, there has a very close relationship in them. Quantitative Analysis: This model follows the idea of Arrow (1961),simulate technic as the results of learning by doing, based on this, assuming the production function is Cobb– Douglas production function, Trade promotes economic growth through technology spillover, combined exports, imports, capital investment, labor input and other factors and economic growth to analysis, use ADF test, cointegration test, error correction model and the combination of Cochrane-Orcutt test and other empirical methods, and make a judgement of wheather foreigh trade promotes economic growth by technology spillover, empirical analysis concludes that: technology spillover effect of foreign trade in promoting economic growth is not obvious in Zhejiang Province.The promotion of foreign trade to economic growth is still through labor and capital investment.Foreign trade in Zhejiang Province still takes an extensive road and has a great potential for development.Finally, based on the qualitative and quantitative analysis, the article gave several countermeasures for the sustainable development of foreign trade and economic growth in Zhejiang Province by enhancing technology spillover effect of foreign trade and increasing R & D of advanced technologies and other aspects.