The Empirical Analysis Of The Influence Of Real Effective Exchange Rate On Our Country's Industrial Structure And Employment

Based on the Development Strategy of Comparative advantage, on the one hand, booting out the country's export-oriented economy, on the other hand, the rapid development of labor-intensive industries, particularly the rapid development of processing trade has created the current industrial structure and employment status in China. Exchange rate as a key economic variable whic connecting domestic and international economy, its change must affect the adjustment of industrial structure through a series of transmission mechanism. According to economic principles, and based on the conclusion of previous experience, this thesis attempts to present three transmission channels theoretically through which the variation of real exchange rate can adjust industrial structure and employment. Then we conduct empirical analysis of the influence of real effective exchange rate appreciation on our country's industrial structure and employment in the framework of VAR model, and then explain the results hoping for providing some help for the development of our country's exchange rate policy.Our research turns out that real effective exchange rate appreciation while exercising negative effects on the employment in second industry gives rise to a higher proportion of tertiary industry accompanied with more job opportunities, and, to some extent, quickens the pace of rural labor force transference. As is proved, real effective exchange rate appreciation will contribute to improving our country's industrial structure in the long run, though it brings some short-term pressure on employment.Chapter 1 is an introduction to introduce the research background, propose the question, review relevant literatures, propose research methods and ideas, and explain the current debates on the issue of RMB exchange rate.In Chapter 2, we present three transmission channels theoretically through which the variation of real exchange rate can adjust industrial structure and employment structure: (1) the price pass-through effect of the exchange rate, (2)by foreign trade, (3) by foreign direct investment.Chapter 3 briefly describes the empirical model we used in this paper: VAR model and the LA-VAR model, and some related testing.Chapter 4, we conduct empirical analysis based on empirical data of our country. In Chapter 5, we explain the empirical results.Chapter 6 summarizes this thesis and proposes innovations and shortcomings.