An Empirical Research On International Trade Affects The Wage Distortion Of Textile Industry In China

Tremendous changes has witnessed in China since the reform andopening policies in1978. For example, both of China’s total GDP and theinternational trade turnover have reached the second largest in the world.However, China is also confronting serious problems of inequality andwage distortion. It has been pointed in the Social Security Green Book in2012that the labor share (labor remuneration in the proportion of GDP)of the second industry and tertiary industry has been declining and theincreasing rate of wage runs slower than the increasing of the productivityof labor and GDP, which is called the wage distortion, since the early1990s, especially in the textile industry. The author starts from the angleof international trade, counts the wage distortion index of the textileindustry, establishes a regression equation with import dependence,export dependence and intra industry trade index to analyze howinternational trade affects the wage distortion in the textile industry bycomprehensive using of descriptive analysis, normative analysis andempirical analysis and finally puts forward some suggestion on how tosolve the problem of wage distortion in the textile industry of China inthis article, for the existing researches on wage distortion are mainly inthe view of foreign investment, and international trade excessively canincrease wage distortion through the technology progress, marketcompetition and distorting the labor market. The author finds that, by regression analyzing the statistical data oftextile industry in1988-2011, the increasing of export dependence,capital-intensity, intra industry trade can promote the wage distortion inthe textile industry of China but the increasing of import dependencecan’t. Therefore, increasing import and decreasing export properly duringthe transition period of the textile industry can not only restrain the wagedistortion but also expand the domestic demand which can accelerate thetransformation of economic development mode. Besides, increasingimport and decreasing export can even reduce the “double surplus”phenomenon to some extent so as to reduce the pressure on theappreciation of RMB.