China's Comparative Advantage Industry Terms Of Trade

As the development of globalization, more and more developing countries do not catch up with the developed nations, and one of the fundamental reasons is that the terms of trade of developing countries have been becoming deteriorated. Therefore, the western economic field begins to pay much attention to this problem from 1950s. It is first to discuss the problem which the allocation of comparative interests are not imbalance between developed nations and developing countries from the aspect of the terms of trade, so it brings rigorous challenge to free trade theory and policy which is based on comparative advantage. Therefore, it is worthy to cogitate the terms of trade of our country because we take part in the international division of labor all the time according to the principle of comparative advantage. Especially, as the coming of knowledge economy, it not only brings us the opportunities to change our comparative advantage and improve the terms of trade, but also brings us so many challenges. Therefore, it is important for us to take good advantage to develop the technology and to improve the grade of our comparative advantage dynamically.From the index of RCA and NTR, we can see that the comparative advantage industry still coverage to the low-tech sectors, which possess a mature and solid advantage no matter in the world market or the regional market Although it brings us so many real interests now, but it does not mean that we can gain the benefits in the future if we still participate international labor division as now. So we should research and analyze this issue dynamically. As nations interact more and more with each other, the traditional index of terms of trade could not assess the diversified activities of a nation perfectly, so we should apply the model of export commodity competition to considerate the comprehensive factors, including the index of trade quantity, trade price, foreign rate and so on, which can affected the terms of trade of our country. Though the calculation, we make the conclusion that the net income terms of trade of our country has been improved, but this is brought by the strategy of low-price, so the result and the prospect are not optimistic. Therefore, we must reconsiderate the terms...