Influence Of Vertical Specialization On The Competitiveness

Along with the development of global economic integration, the industrial production layout have experienced obvious changes. Some developed countries transfer some industries to developing countries using multinational companies as the carrier. Traditional inter-industry specialization transfer into intra-industry specialization, and the division of labor becomes more and more detailed. The manufacturing industry chain expands in the world, and more and more countries take part in the vertical specialization. Experience shows that the vertical specialization will have great influence on a country’s industrial competitiveness. Based on the above background, this paper researches the effect of vertical specialization on China’s international competitiveness of manufacturing. We select 13 representative manufacturing industries, and estimates the degree of vertical specialization of them using the input-output table, in order to analyzes the characteristics of different industries in the vertical specialization. Thus we can have a comprehensive understanding of the characteristics of vertical specialization and have a more clear understanding of the development trend of manufacturing industry of our country in the global production value chain. In addition, the manufacturing industry of international market share is also chosen to describe the level of international competitiveness. According to the influence of vertical specialization on the international competitiveness mechanism, we establish econometric model and make comparison between them. Through analyzing the results, we find that the degree of vertical specialization will enhance the international competitiveness of China’s manufacturing industry, but the influence on different factor-intensive industry is different. The effects on capital and technology intensive industry is greater than that on the labor-intensive industry. Chinese manufacturing enterprises should have a clear cognition of its status in the world, and adapt to the situation of international vertical specialization production, and make full use of the opportunity of industry transfer of developed countries. Only in this way, can we promote the upgrade our industrial structure, and improve the industrial international competitiveness.