Research On International Trade Transmission Mechanism Of Economic Cycle

Economic cycle is a cycle process that a country’s economic expansion, contraction,expansion, and contraction. The periodic fluctuation reflects the change between contradiction andequilibrium of social total supply and total demand, also reflects the situation of social total outputand economic structure.With rapid development of economic globalization, international trademake a country’s native economy periodic wave motion transmitted to other countries, and thenational economy development will fluctuate be due to external shocks. Therefore, to explore thetransmission mechanism of economic cycle, know the rule, to expect economic fluctuation, caneffectively avoid the economic fluctuation from the international market and other country toChinese economic.This paper studies how international trade transmission economic cycle.This study first reviewed traditional economic cycle theory formation and developmentprocess, then conducted an in-depth theoretical analysis, on the basis of empirical analysis, thispaper uses1978-2011year economic data of China,United States, Japan, Germany, South Korea,the UK and Brazil, established VEC model, based on unit root test, cointegration test, impulseresponse function, variance decomposition methods and based on panel data model, in-depth studyof the international trade transmission mechanism of the economic cycle. Then the paper draws thefollowing conclusions: Firstly, most countries have shown significant convergence growth trend,but there are still differences between economic fluctuations. Secondly, other countries’ GDP andthe import and export influence Chinese economy presents a different characteristic, havestimulative effect, also have an inhibitory effect, lag period is also different. Finally, stimulativeeffect size from bilateral trade to bilateral economic cooperative motion is the same, but countrieseach have a difference factors, and the influence of fixed effects are different. Based on the analysisof conclusions, this paper forward that in the future China should grasp the economic fluctuationrule, maintain moderate growth of trade, do trade in the direction of diversification, expanddomestic demand, adjust the industrial structure, increase the import of technology.