The Study On The Impact Of Manufactured Goods' Export Market Structure On Its Export Instability In China

As the main part of China's export, manufactured goods has an obvious impact on driving trade profit and industry development, also stabilizing industrial employment. Therefore, reducing the export instability of manufactured goods, as well as the uncertainty of the market risk has important practical significance. Among all the causes of export instability, the market structure has always been a very important factor. This paper discusses how the export market structure influences the export instability of manufactured goods, so as to provide suggestions about optimizing trade structure and stabilizing export fluctuations of manufactured goods.Firstly, through three specific indicators, this paper measures the export market structure and its trends of Chinese manufactured goods in 1998-2007. We can see the current high degree of market concentration. The export mainly concentrated in the big four markets: United States, European Union, Hong Kong and Japan. China has opened up a few new markets, and the market structure is in slow changes toward lower market concentration. Then, via the deep research into the four major markets, this paper reveals that USA and European Union have big fluctuation risk, while Japan and Hong Kong are relatively stable export partners.In the empirical part of this paper, we use the variance decomposition model to study the influence of export market structure on export instability. The result shows: the export values to each major market are at a high level of relevance. Among the four major markets, European Union contributes the most to export instability. And the fluctuation effect of EU is much larger than its market share. While Japan contributes the least to export instability, and Japan can obviously smoothen other markets' fluctuation on export instability. Hong Kong and United States contribute to export instability in the middle level. At last, this paper gives suggestions about reducing export instability and optimizing trade structure of manufactured goods.