Foreign Trade Multiplier And Its Effect Analysis

The Predominant mechanism of the economic system in China has been controlled by the side from the supply convent to demand gradually. The demand becomes the main factor of the economic movement. It is urgent to investigate on the demand fluctuation. Multiplier theory gives us some methods for the analysis of the Paper.In an open economic system, national income of a country will increase by several times with the function of foreign trade multiplier when its investment, government expenditure, or export increases. In the meantime ,the change of foreign income will also affect this country's national income and balance of trade through the effect of foreign trade multiplier. Owning to this circumstance,this thesis researches has important theoretic and realistic meaning for that government analysis economy circulating condition,makes use of Policy means to adjust economy and leads foreign trade multiplier to the best economic effect.This thesis systematically introduces theories which related to foreign trade multiplier theory. Then this thesis calculate the multiplier with the methods of the identical equation, and definite the foreign trade multiplier effect China. Finally, basing on the effecting factor analysis of foreign trade multiplier effect of China, it puts forward complete countermeasures to promote foreign trade multiplier effect of China from four aspects, such as import, export, consume and system.