Research On Home Market Effect Of Manufacturing Industry Exports In China

China's comparative advantage in export trade has been considered from low labor costs, but the inevitable trend of increasing labor costs in China traditional comparative advantage makes this difficult to sustain. On the other hand, China's foreign trade has achieved good results year after year since the reforming and opening . This shows that China's foreign trade depend not only on traditional labor resource endowment advantages,but also inevitably depend on another advantage showing from the side of the development of China's foreign trade. Based on the fact of the increasing labor costs and China's export growth year after year ,this paper will discuss another possible source of comparative advantage of exports in addition to the existing traditional advantages of cheap labor resource endowment .That is Home Market Effect.In this paper, based on the basic theory of International Trade knowledge, the author use the First National Economic Census three-digit sub-industry, cross-section data in 2004 to study this qustion. First, the author take the descriptive statistics of the country's Manufacturing Industry in China and Manufacturing Export enterprises of different ownership characteristics; Second, the paper take empirical research on the Home Market Effect of China's Manufacturing Industry and industry differences exists. Purpose of empirical testing to answer the following two main questions: First, if there exist Home Market Effect in China's export Manufacturing Industry; Second, based on different resource endowments of industry characteristics, what are differences of Home Market Effects in different industry in their performance. Empirical research show that China's Manufacturing Exports has a significant Home Market Effect, and the better the quality of labor, the higher the level of industry R & D , their Home Market Effect is more significant. In this way, we will demonstrate the feasibility of the theory, and enhance its explanation power by getting the theory and practice together. Finally, under the elaboration of these two parts, the author will give some advices.In this paper, the research on Home Market Effect of Manufaturing Industry is not only to provide a good way to understand China's further industrial trade structure, but also to perspect our current and future upgrade trade structure Strategic choice. Meanwhile, research on Home Market Effect will also help protect our political and economic independence and security.