External Imbalances Of Chinese Economy And Economic Decentralization

This paper analyses the influence of external imbalances of China’s economy mainly from the institutional factor:Chinese-style economic decentralization. Firstly, based on the study of many scholars, this paper believes that the fundamental or deep seated reasons leading to the external imbalances of China’s economy should be the imbalances of economic structure in domestic, and yet that the imbalance of internal economic structure remains so long must have its regime foundation. Then, on that basis, we build a influence mechanism of Chinese-style economic decentralization on the external imbalances of China’s economy in theory. Furthermore, by using the data of29provinces in1995-2009, we establish an empirical model to validate this mechanism, and find that economic decentralization has a positive effect on the surplus in commodity trade and FDI. Finally, on the basis of logical analysis and empirical analysis, this paper proposes the conclusions and policy implications.