The Real Effective Exchange Rate Changes On The Yangtze River Delta To Study The Impacts Of Foreign Trade

With the in-depth development of global economic integration and economic tiesbetween the countries and regions in the world is getting closer and closer, this hasbeen an unprecedented development of trade between the countries and regions, andon this basis, foreign trade has gradually become a driving force one of an importantforce in one country and regional economic development. The real effective exchangerate as one of the important factors affecting foreign trade, a profound impact on anational and regional economies within and outside the balanced and healthy,sustained and rapid development.The administrative area of the Yangtze River Delta, including Jiangsu, Zhejiangand Shanghai. GDP of the Yangtze River Delta region in2009reached7.24941trillion yuan, accounting for the proportion of20.4%; the Yangtze River Delta region,the import and export volume reached$804.298billion, the country’s total import andexport volume accounted for36.4%. Thus, the Yangtze River Delta region as a wholeto study the relationship between foreign trade and real effective exchange rate, andthen develop a series of foreign trade policies and institutions appropriate to the actualsituation of the Yangtze River Delta region, which vigorously improve the YangtzeRiver Delta region’s foreign trade industry’s competitiveness in international markets,stimulating foreign trade, the deepening of the development of the transformation ofeconomic development and foreign trade patterns as well as to promote the health ofChina’s foreign trade, sustained and rapid development have important theoreticalsignificance and practical significance for practical guidance.Based on the Marshall-Lerner condition in the theory of elasticity and derivedfrom the "J-curve effect", the use of, including the least squares method, the errorcorrection model, vector autoregression model, the vector error correction model,impulse response function and variance decomposition of a series of econometricmethods, respectively, on the Yangtze River Delta region of RMB real effectiveexchange rate fluctuations and the intrinsic relationship between the import andexport trade conducted in-depth study. In this paper, the weighted arithmetic mean ofthe Yangtze River Delta region, foreign trade data, estimated that the RMB realeffective exchange rate index of the Yangtze River Delta region, making research fitthe actual situation in the region, the conclusion is more convincing.The study found that the price elasticity of demand for the import and export ofthe Yangtze River Delta region to meet the Marshall-Lerner condition, the devaluation of the RMB exchange rate can be improved to a certain extent theYangtze River Delta region’s international trade balance. The same time, themagnitude of the impact of economic growth and real income changes in the level ofimport and export trade of more than RMB real effective exchange rate fluctuationson the import and export trade, that the continued prosperity of the import and exporttrade of the Yangtze River Delta region to adapt to economic growth to enhance thelevel of needs and the needs of the people, can not simply be attributed to theso-called internationalization of the RMB undervalued.According to the conclusions of the study, adhere to further improve themanaged floating exchange rate of RMB exchange rate formation mechanism on thebasis of the Yangtze River Delta region should be combined with the actual situationin the region, vigorously develop the economic area, to further optimize the mode oftrade and the environment, in-depthidentify talent advantage and the steady expansionof foreign investment; the same time, steadily push forward the process of RMBinternationalization, the rational use of foreign exchange reserves, resources andsupport of export credit insurance, and lay a solid foundation for sustained and steadydevelopment of the foreign trade of the Yangtze River Delta region health.