Research On The Effect Of Intra-product Specialization On Industrial Structure Upgrading Of China

Since 1970s, with the development of economic globalization and the progress of science and technology, international division of labor has experienced significant changes, within which the most important one is the internationalized production and cooperation of products. Due to this change, the production mainly did in one country or one region in the past has been distributed to different countries and each country specializes in the production of products in some special period or components and parts of the products, thereby international division of labor has been developed to products from inter-industry and intra-industry. This new form of Intra-product specialization has brought great changes to the way of international trade and the content and performance of industry structure upgrading which is no longer simply from labor-intensive industries to capital-intensive or technology-intensive industries but also includes the upgrading from labor-intensive links to capital-intensive or technology-intensive links in one industry. Therefore, the comparative advantage between countries shows not only in industries but also deepens into every links of production. This change provides a new entry point for developing countries participating in the international division of labor, brings down the critical condition to developing countries joining the international division of labor system and brings new opportunity to developing countries in upgrading their industry structures. In this paper, vertical specialization index is applied as a indicator to measure the extent of Intra-product specialization of our country, empirical research is did on the influence that Intra-product specialization exerts to industry structure upgrading to identify the influence Intra-product specialization exert to industry structure upgrading of our country and provide suggestion for the industry structure upgrading of our country in the system of international division of labor.This thesis is divided into six parts. The first part is the introductory chapter which includes the background and significance to select the subject, concept definition, and the findings and inadequacies of the thesis. The second part is a literature review of the background and theory explanation of the Intra-product specialization and relevant documentary study of the influence that international division of labor exerts to industry structure upgrading which is the basis of this thesis. Besides, the relevant theories and researches are discussed in this part. In the third part, current situation of the processing trade and the level of Intra-product specialization in China is analyzed, the relationship between processing trade and Intra-product specialization is set out, the condition of processing trade as the main trade embodiment of Intra-product specialization is analyzed further and the extent of Intra-product specialization of our country is measured. In the fourth part, the transmission mechanism of influence that Intra-product specialization exerts to the industry structure upgrading of our country is analyzed mainly from the aspects of technology progress, optimizing configuration in supplying production factors, trade structure, policies and other factors. The five part states the theme of the thesis. Firstly, the measuring indicator of industry structure upgrading in our country is identified. Secondly, empirical research is done on the influence that Intra-product specialization exerts to industry structure upgrading from the perspective of measure economics. Finally, the influence that Intra-product specialization exerts to different industries is explored from the aspects of different industries and the measuring results are analyzed from the theory of economics. The last part is the conclusion part in which the results concluded from the above chapters is summarized and the suggestion of policies is provided accordingly.Processing trade, as the typical trade form in Intra-product specialization, has made great achievements in China. The index of Intra-product specialization of relevant industry in China has been raised. The deepening in the extent of participating in Intra-product specialization promotes the industry structure upgrading of our country. According to the analysis of Intra-product specialization of our country from different industries, it can be seen that industries participating in this new international division of labor in our country are mainly capital and technology intensive ones. Besides, participating in Intra-product specialization plays the most important role to promote the industry structure upgrading in the secondary industry of our country.