Analysis On Upgrading Of Processing Trade Based On The Intra-Product Specialization

With the development of science and technology, in the last 30 years of 20th century, international trade happened many outstanding changes, of which the most important changes occurred in vertical specialization based on the global production cooperation, which is defined as intra-product specialization. As our country's most important trade form in boosting China's economic development, processing trade plays an important role. Based on this, the paper analyzed the adaptability and the position of the intra-product specialization in China and the key factors which influence the upgrading of processing trade, and then the thesis tried to look for measures to accelerate the pace of upgrading of processing trade in the new trends of international specialization.Based on previous literatures both from domestic and foreign countries, this thesis summarized the connections between processing trade and the intra-product specialization, as well as the upgrading path through which intra-product takes boosting effects on processing trade. And then the paper analyzed the important role of intra-product specialization and the current status of intra-product specialization in china. Meanwhile, this paper examined the Chinese processing trade's current position in participating in intra-product specialization, and then the paper found the decisive factors which influence the upgrading of Chinese processing trade. Afterwards, the thesis use the panel data mode to tested the decisive factors with empirical analysis. Empirical findings suggested, the degree of intra-product specialization, domestic technical level and the actual foreign investment changes have positive effect on the upgrading of processing trade. At the same time, from the parameter estimation results, we confirmed that the effect, which intra-product specialization degree have to added value chain, is more obvious than the actual spillover effect of foreign direct investment, fully reflected the importance of current actively encourage on participation in international intra-product specialization. Blindly introduction of foreign capital maybe produces limited technology spillover effect.While the effect of the ascent of technical level to upgrading is more apparent than both former ones, which illustrated that only with the ascension of our own technical level can we finally change the present situation of Chinese processing trade structure problems. To change structure of processing trade, eventually, the dominant force still exists in its technical standard rising. The empirical results tell us, eliminate the progress of technology, the boosting effect of capital labor elements ratio to upgrading of Chinese processing trade is not obvious, this even could likely to be negative. This is decided by the current weak technical transformation ability and economic growth mode which mainly counted on the investment. And all these analysis results have crucial effect on further putting forward the thinking direction of boosting the upgrading of processing trade.Finally, based on empirical analysis results, the measures were put forward for promoting upgrade in Chinese processing trade, we should emphasis on the dismiss the negative effect of capital labor rate, enhance the effectiveness of domestic capital and labor supply. Meanwhile, we should encourage the involvement in the intra-product specialization, channel in the FDI with selective views. Last but not the lest, we should actively channel in the high-technical devices and even human resources, encourage the domestic innovation of our high-level technical talents in order to increase our own technology level.During the analysis process, I find the paper still exist some shortcomings. Firstly, some important variables such as industry environment and policy were not concluded in the mode for the difficulty of quantify. Secondly, during the analysis of different reason for different factors, for the difficulty of obtain classification data, the paper may exist some discrepancy. At last, for the reason of mode setting differences, some conclusions still need further analysis.