Study On The Existence Of "Immiserizing Growth Trap "of Tyre Export In China

In recent years, Chinese overall productions and exports of tyre have ranked first in the world.However, with the low price of export and worsening trading environment, it is extremely possible to appear the “Immiserizing Growth ”.This paper firstly analyzes the current situation of Chinese tyre industry, selects the latest data after joining the WTO, focuses on the status and features of Chinese tyre production, import and export. The research finds out the existence of excess production, low industry concentration, low brand awareness and low market competitiveness of Chinese tyre enterprise, which proves that Chinese tyre exports have been in line with the premises of “immiserizing growth”.This paper deduces the mechanism of distorted model of Chinese tyre exports from three views, like factor endowment, global value chain and comparative advantage trap. It clarifies the formation reasons of competition and low price sales of Chinese tyre industry, infers the price response mechanism under long-term competition, analyzes the source dependence and lack of technology of domestic tyre, finds out competitive advantages and disadvantages and key control point, and explains how Chinese tyre exports stuck in the static comparative advantage in paradox.To examine the existence of “immiserizing growth trap” of Chinese tyre exports, the article sets up the model of “export immiserizing growth”. General equilibrium model is established, the variables, such as real wealth(qIW) and practitioners’ economic welfare are introduced to test the existence of "immiserizing growth". After inspection, it finds that the price of Chinese tyre import and export deteriorates, income deteriorates, single factor has been improved but the force is small, double factors relatively worsen. But the real industry wealth and pactitioners’ economic welfare of Chinese tyre industry do not reduce, which depends on the development of the productivity and the labor efficiency and wage level of ascension. Although the industry wealth and economic welfare indicators don’t decrease, its growth has fallen sharply, the growth in part of years even backwards. Therefore, it may not judge Chinese tyre exports have totally appeared“immiserizing growth”, but at least it is sure that there has been a tendency and cases of“immiserizing growth”.Finally this paper puts forward reasonable suggestions in terms of the dilemma and problems of Chinese tyre productions and exports, encourages to promote the product quality and grade,optimizes the export structure, cultivates competitive advantages, advances the position in the global value chain, and all of these are for the sustainable development of Chinese tyre industry.