Study On Sino-US Bilateral Trade

China is the largest developing country in the world, since the reform and opening in1978, the foreign trade develops quickly, China has became a big trading nation. After the establishment of diplomatic relations in1979, Sino-US trade and the bilateral trade expand rapidly. The statistics of the two countries all illustrate that the trade volume between the two countries have expanded a hundred times until now. According to Chinese statistics, in2012, the United States has became China’s second largest trading partner, largest export market and the fifth largest source of imports, the bilateral trade amounted to$484.68billion, accounting for12.5%of China’s total foreign trade. According to U.S. statistics, in2013, China has became the second largest trading partner and third largest export market, the largest source of imports, and the China-US trade in goods is$582.11billion, up4.9%year-on-year, accounting for14.9%of the total United States trade in goods. Sino-US relations is in the most mature and stable period of development since the two countries had established diplomatic relations, and Sino-US trade relations have long played a role of the stabilization.Sino-US economic and trade cooperation is a win-win choice.After a number of scholars making research on gravity model from theoretical and empirical, the gravity model has became an important method of research about bilateral trade. Since the data needed by gravity model with strong availability and high reliability, which lead to the application of trade gravity model becomes more and more widely. As a major tool for empirical research in international trade flows, some scholars call vividly gravity model "the draft horses for empirical research on bilateral trade". In the subsequent expansion of the model, the researchers can choose different explanatory variables which can affect bilateral trade flows based on their own research priorities to analyze the impact of these factors in the size and direction, and estimate trade potential. In this paper, taking use of the gravity model to study Sino-US bilateral trade volume by theoretical and empirical analysis, trying to clearly identify the factors that influence the development of bilateral trade and provide a strong reference for the formulation of appropriate policy measures.In this paper, applying theoretical analysis and empirical analysis approach. In the overview section analyzing the development of Sino-US trade, making use of charting tools to analyze the total amount of bilateral trade, the results show that the rapid growth of bilateral trade, bilateral trade between the two countries respective position in foreign trade is changing, the two mutually for each other’s second largest trading partner, and Sino-US trade surplus is gradually expanding. According to Chinese statistics, the number of Sino-US trade volume increased by197times in the1979-2012years, of which China’s exports to the U.S. increased by591times; while China’s imports grew less, an increase of only71times. And, since1993, Sino-US trade surplus begin to appear. Up to2013, the difference has been expanding along by35times in nearly20years. According to U.S. statistics, Sino-US trade volume increased by more than237times from1979to2012, of which U.S. imports from China increased by678times, while its exports to China increased by only71times. Sino-US trade imbalance appears since1983. Up to2013, the United States has been in a deficit position and Sino-US trade deficit is gradually expanding.Then by analyzing the structure of Sino-US trade, the product structure of bilateral trade was found to further optimize. Because China is rich in labor resources, according to the endowment theory, China’s exports of labor-intensive products are the most, which is consistent with the data depicted. But at the same time, the proportion of China’s exports of capital-intensive products in technical rises rapidly from29.97%in1992to45.29%in2012, the amount rises from$15.78trillion to$1895.5trillion with an increase of120times, which is much higher than the growth rate of China’s exports of labor-intensive products. Since2006, the proportion of exports of labor-intensive products has declined year by year. In addition, by comparing Sino-US trade dependence on imports and combined index, Sino-US trade imbalance was found that China’s dependence on the United States is stronger, and the attractiveness of the U.S. market for Chinese goods is greater than the Chinese market the attractiveness of U.S. goods, but in recent years this imbalance is gradually smaller.In the empirical part of the use of the gravity model of bilateral trade, we can find the following results:First, the factors affecting Sino-US trade include the GDP of the two countries, distance between the two countries, trade openness, China’s population and the Per capita income difference. The factors affecting Chinese exports to the U.S. include American GDP, the distance between the two countries, China’s population, the trade openness of American. Compared with the factors that affect Sino-US trade volume, China’s GDP and trade openness in China this two variables missing, namely, Chinese exports to the U.S., affected by the purchasing power of the United States. The factors affecting China imports from U.S. mainly have Chinese GDP, the distance between the two countries, the difference in per capita income between the two countries and the United States trade openness and so on.Second, China’s GDP has effect on the Sino-US bilateral trade and imports from the United States, which is consistent with the theoretical expectations; U.S. GDP has a significant impact on Sino-US trade volume and China’s exports to the United States, which also consistent with the theoretical expectations. By making comprehensive comparison, we can see that the coefficient of In Yα is greater than the coefficient of In Yat which means the impact of China’s GDP on Sino-US bilateral trade is greater than the impact of the U.S. GDP increasing.Third, the distance between the two countries has significant side effects on Sino-US trade volume, imports and exports which is in line with the theoretical derivation, and it also has a large coefficient, indicating that the inhibitory effect on trade is big.Fourth, the trade openness of United States has a significant impact on China-US total trade, imports and exports. And China’s trade openness only affect the China-US total trade.Fifth, China’s population has a significant impact on Sino-US trade and China’s total exports, and the coefficient is the highest. The impact of the U.S. population is not significant. Sixth, the rate of exchange about RMB exchange rate do not affect the trade between American and China,means financial markets did not have a significant impact on trade.Similarly, the two countries joining the WTO or not also have no significant effect.The article concludes with policy recommendations to promote the improvement of Sino-US trade.First, Sino-US trade imbalance should be taken seriously. Americans due the unemployment problems of manufacturing to China trade surplus with the United States. They think the pressure should be putted on appreciation of the RMB. Faced with this situation, we can solve it by knowing that who should responsible for the balance, improving our import policy, inducing the relaxation of U.S. high-tech exports to China and even abolish restrictionsSecondly, adjusting the industrial structure and improving the trade structure. Whether the goods or services trade, China is still in the stage of factor endowments. Although China’s exports to the U.S. capital-intensive products has been increasing, but still focus in labor-intensive products. We should implement the " Twelfth Five-Year Plan" to promote industrial restructuring and upgrading to further enhance the importance of product quality, increase the added value and technological content of export products, which all can increase China’s economic efficiency, enhance China products in the U.S. market and even in the international market competitiveness.At last, using of the "China-US Strategic and Economic Dialogue" and the WTO dispute settlement mechanism to resolve disputes.