Research On Financial Development And Technological Content Of Export Products

After30years of reform and opening-up, China has grown into the world’s largest goods exporter and second largest economy. However, the low level of technological content and irrational structure of export commodities show that China is a big trading nation but not a strong one. Therefore, it’s urgent to transform the growth mode of foreign trade, improve the technological content of export products and achieve the transition from a large trade country to a strong trading power. Therefore, the relationship between financial development and technological content of export products has become a hot issue for research. At present, China’s financial scale increases rapidly but inefficiently so that the relatively low level of financial development has become one of the important factors that restrict technological content of China’s export products to enhance. Thus, the study of the impact of financial development on technological content of export products is of great, important, theoretical and practical significance for optimizing the structure of export trade and transforming the way of growth in China’s foreign trade.On the basis of the theory of the functions of the financial system, the paper constructs the theoretical framework about the impact of financial development on the technological content of export products. Theoretical analysis shows that financial development affects the technological content of export products mainly through three channels such as capital accumulation, financing incentives and technological progress. Meanwhile, the paper uses the modified Hausman Model which was designed by Hausmman in2005to measure the technological content of provincial and regional export products. The result reveals that the overall technological content of export products in China has greatly improved but shows an obvious regional discrepancy. The technological content of export products in the eastern region is higher than those in the central and western regions, and the differences between regions show a gradual trend of expansion.Based on the data from2002to2009of30provinces in China, the paper uses static panel and dynamic panel data model with GMM estimation respectively to test empirically the influence of different dimensions of financial development(financial scale, financial efficiency and financial structure) on the technological content of export products to further validate the conclusions of this study. The empirical result reveals that financial scale, efficiency and structure have a positive effect on improving the technological content of export products. Moreover, the influence of different dimensions of financial development on the technological content of export products is different. The impact of eastern financial efficiency on the technological content of export products is greater than that in the central and western regions.The central financial scale has the deepest influence on the technological content of export products. The impact of the western financial structure on the technological content of export products is the largest among the three regions. On the basis of the summary of theoretical and empirical tests, finally the paper further puts forward four suggestions. The paper is divided into six chapters:The first chapter is introduction. This part mainly introduces the paper’s background, significance, main contents, innovation points and difficulties, structural arrangements as well.The second chapter is literature review. This part mainly focuses on reviewing and summarizing the related literatures on financial development and technological content of export products. The third chapter is theoretical study. Based on the theory of the functions of the financial system, this part systematically describes the inherent mechanism about the impact of financial development on technological content of export products.The fourth chapter is status analysis. Firstly, this part introduces the measure of financial development, technological content of export products and related indicators. Moreover, the paper measures and analyzes the level of financial development and technological content of30provinces in China with the help of the above indicators.The fifth chapter is the empirical test. On the basis of the export data from2002-2009of30provinces in China, the paper uses static panel and dynamic panel data model with GMM estimation respectively to test empirically the influence of different dimensions of financial development on the technological content of export products.The last chapter is conclusions and suggestions. The part generalizes the paper’s conclusions and puts forward proposals to promote financial development and improve the technological content of export products on the basis of above conclusions.