The Mechanism Research Of Intra-Industry Trade On Economic Growth

With the continuous progress of global economic integration, the world international trade especially the intra-industry trade has deceloped more quickly, which accounted for the proportion of each country’s foreign trade is rising year by year. The related statistics shows that intra-industry trade has accounted for more than60%of the world goods trade currently. With the convergence of every country’s technical level and factor endowments, in the future international trade, intra-industry trade will exceed the inter-industry trade and become a major business model. From the reform and opening up to now, China’s foreign trade has developed rapidly and becomes one of the "troika" which push the economic growth of China. In2013, China had been the biggest commerce country in the world by achieving4.16trillion dollar in the foreign trade. At the same time, our country’s structure of foreign trade has been improving too. Every province’s foreign trade situations also have different degree of improvement, which make great contribution to the local economy development.Jiangsu Province as the country’s second major economic province, the foreign trade development is also in the top. Foreign trade makes huge contribution to Jiangsu’s economic development, but in recent years it’s economic growth has been slowed down. Based on the characteristics of the economy and foreign trade in Jiangsu Province and combined with the trend of the intra-industry trade development, the paper starts from the spillover effect of intra-industry trade on economic growth and combines with the previous studies and the latest research on a dynamic basis. Firstly, the writer makes introduction to the mechanism of intra-industry trade on economic growth, so that can lay a foundation for the policy recommendations. Secondly, I construct the index system for intra-industry trade including G-L index, the amount of intra-industry trade, the growth of intra-industry trade and the geographic direction of intra-industry, so that I can ues these indexes to describe the intra-industry trade current situation of Jiangsu Province. It turns out that intra-industry trade in Jiangsu Province is the main mode of foreign trade, and industrial products is the major products of intra-industry trade. Thirdly, I make empirical tests for the relationship and the mechanism of intra-industry trade and economic growth, and also test for the influence factors of economic growth which combine with the statistical data of Jiangsu Province between2000and2012. The empirical results show that Jiangsu Province’s intra-industry trade and economic growth is positively correlated and reciprocal causation. Meanwhile, intra-industry trade of Jiangsu province can promote economic growth by economies of scale, technology aggregation effect, human capital accumulation and the industrial structure of the industry. Finally, I put forward some suggestions on how to develop intra-industry trade in Jiangsu Province and make contribution to its economic growth by contacting with the current situation of the intra-industry trade in Jiangsu Province and combining the theory analyze and the empirical conclusions.