A Game-Theoretic Analysis Of Sino-US Trade Friction

As the biggest developing country and the biggest developed country, China and America are mutual complementary in items of their resource, economic and industrial structure and level of consumption. There are great advantageous conditions and potential to develop trade and economic cooperation between them. Since China and America established diplomatic relations, especially after the termination of cold war, Sino-U.S. economic and trade cooperation has expanded rapidly because of the common economic interest, and propelled the bilateral economic relations forward continuously. However, the development of Sino-U.S. economic and trade relations have not always been smooth, because trade frictions occur occasionally and which also have an increasingly fierce tendency. How to view this phenomenon? How to deal with this problem? These have become the major issues that concern our government, enterprises and academic circles.This paper which tries to use Game Theory to analyze trade frictions between China and US not only studies the interaction of trade policies between the two countries from the perspective of macroeconomic but also discusses the interaction of strategies between various bodies in trade frictions from the perspective of specific cases. This thesis consists of five parts. The first chapter introduces the theoretical basis of trade friction and demonstrates the inevitability of Game Theory to apply in the study of trade friction. In chapter two, I summarize the current trade situation between China and the United States and make an inspection of history friction game between them. Chapter three carries on a comprehensive and systematic study of trade friction between China and US based on Game Theory. This part not only analyzes the trade policies game but also studies the specific cases combined models of Game Theory. Chapter four analyzes the economic effects to each country produced by trade friction game. In the last chapter, combining with the conclusions form foregoing analysis, I put forward some proposals by analyzing the game between the two countries'governments and the enterprises so that the game capability of our government and enterprises can be enhanced.