| With the establishment of ASEAN, NAFTA and the European Union, regionaleconomic integration, together with economic globalization, has became one of thetwo major trends of economic development. However, regional cooperation in Asia,especially in East Asia is very loose, which is mainly due to the slow cooperationprocess among China, Japan and South Korea. In face of this situation, it is necessaryfor China, the largest economies in East Asia，to analyze of possible pathes of thetrilateral cooperation comprehensively, choose right partners in certain stage, andpush the trilateral cooperation move towards the direction that is most favorable toChina.Based on the theory of regional trade agreements, this paper has selected the gametheory as the analysis frame, used the GTAP model to calculate profits of the eachparty in the game, and divided the analysis into two parts: real situation and completesituation. The purpose of this paper is to make recommendation to China underdifferent circumstances.Firstly, this paper has reviewd applications of game theory, the theory of regionaltrade agreements, as well as quantity empirical analysis theory, in this field. Then itturns to reality, pointing out that "domino effect" is shown in the progress ofcooperation. However, the trilateral cooperation process is slow, and there is a lack ofbilateral cooperation between China and Japan. Then it changes from qualitativeanalysis into quantitative analysis. Based on the GTAP model (a well developedcomputable general equilibrium model), and taken the tariff variable as a policyvariable, this paper gives simulation results in relative change of GDP, based onwhich it concluds that the optimal choices of the three countries all shows "the Axle-Spoke effect", but South Korea’s second-best choice is the bilateral cooperation withChina rather than the trilateral cooperation. Then the paper combines different actionsand profits of three countries in a comprehensive analysis frame, which is divided intotwo parts in accordance with the different attitudes of the Japan. In real situation,when Japan does not conduct bilateral negotiations with China, based on the completeinformation dynamic game model, this paper points out that China and South Koreawill reach Free Trade Agreement (FTA) in the first, forcing Japan to change itsattitude in China-Japan FTA, and reach the China-Japan-Korea FTA at last. In complete situation, this paper concludes that China, Japan and Korea can reachtrilateral cooperation in “cheap talk”, based on the complete information static gamemodel. Comparing the equilibrium outcome in both cases, this paper gives reasons ofthe slow coorporation process, and lead to the conclusion that it is too hard for Chinato change the real sitution into complete one. What’s more, the real situation is morefavorable to China. Therefore, China should take China-Korea FTA as the best choicein cuurent stage. Finally, this paper points out that according to simulation results ondifferent production departments from the GTAP model, China should firstly expeditethe construction of the China-Korea FTA with support from Korean’s export sectorand the textile industry, and then try to build China-Japan FTA with support fromJapan’s export sector and heavy industry, at last join the China-Japan-Korea FTA.Compared to previous studies, the innovation of this paper is mainly reflected in theanalysisl methods and research area. Firstly, this paper combined the game theoryanalysis and computable general equilibrium analysis method to analyze differentpathes in both real situation and complete situation, and it expanded the action setfrom two element to four, making the analysis much closer to reality. Secondly, thispaper pointed out the most favorable and possible path of China to push the triletaralcoorporation moving forwards, so China should concentre on China-Korea FTA in thecurrent stage. And this paper also gives recommendation in different stages based onGTAP model policy simulation results. |
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