Equilibrium Analysis On FDI And Dynamic Effect Of International Trade

From 1990s', the EXP and IMP volumes of international trade between countries keep on acquiring a great growth every year. In the mean time, the foreign direct investment increases steadily alone with the international trade, which occur both between developed countries and between developed and developing countries.The integration of international trade and FDI focuses on China, who is the most giant and positive market in the 21 century around the world.This article states, on the base of the theory of integration of international trade and FDI, the Theory of Multiplier and the Acceleration Principle r, the dynamic advantage of international trade drived by the primary FDI and the dynamic advantage of FDI drived by the international trade accordingly. In the dynamic advantage of international trade includes the increase of employment rate, tax collection, the technology renovation and the industrial update. While the dynamaic advantage of FDI includes the position updating of China in the international supplier chain in the strategic plan of the large multi-national enterprises from USA and Europe.