China And India Intra-industry Trade Theory And Empirical Research

After 1960s,International trade theory began a new revolution. Intra-industry trade theory,as a representative of the post-war international trade theory ,become latest frontier.Intra-industry trade mainly comes from product difference and economies of scale.In the long-term,intra-industry trade research is concentrated on the developed countries, and whether exists in developing countries lack of specialized argument. Especially in developing countries, intra-industry trade in the study is quite less.From the economic perspective,China and India belong to developing countries,and the two countries have been continued growth in the bilateral trade.Along with the level of economic development in the two countries increaseing,intra-industry trade has become an important component to China-Indian economic trade, and has an important implication to bilateral trade.Based on intra-industry trade theory,using G - L index analyzes the overall status of intra-industry trade to China and India,and the calculated result shows that index of intra-industry trade between India and China reaches 0.95 while is continuous higher.Then from three aspects of product characteristics, trade structure and trade competitiveness, the article deeply analyzes and concludes that sino-indian bilateral intra-industry trade is mainly vertical intra-industry trade, and the proportion of horizontal intra-industry trade is small.According to the present situation of intra-industry trade in China and India,this paper makes empirical analysis to sino-indian intra-industry trade influence factors,that is,establishing econometric model,selecting six variables to investigate the influence of bilateral intra-industry trade levels.And then analysing sino-indian intra-industry trade effect to China's economic.Finally, put forward effective suggestions to promote the development of sino-indian intra-industry trade.