Research On The Influencing Factors Of The Value Added Rate Of Processing Trade In China

Based on the provincial panel data of China, this paper selects the R & D investment intensity, the growth rate of foreign direct investment, labor cost, the degree of opening to the outside world, the characteristics of the industrial structure,exchange rate and other variables, to analyze the factors affecting the value added rate of processing trade in China. The analysis of this paper shows that there are great differences between provinces in the value added rate of processing trade in China. The increase in labor costs has a negative impact on the value-added rate of processing trade, and China’s processing trade does not have the ability to transfer costs. China’s processing trade cannot be timely to share the benefits of R & D, research and development on the value added rate of processing trade appears in one year later. The growth rate of foreign direct investment has an impact on the scale of processing trade, but the impact on the value added rate of processing trade is not significant. The higher the degree of opening to the outside world, the more opportunities the enterprises will get, the stronger selectivity of processing trade enterprises will have, the more benefits we will get to the increase the value of processing trade. The upgrading of the industrial structure doesn’t has the impact on the development of China’s processing trade. This is due to the limited role of manufacturing and processing to enhance the value-added rate of processing trade.The conclusion of this paper has important implications for the development of China’s processing trade. China needs to improve the quality of the labor force, and to achieve the leap from the cost advantage to the quality advantage. Rebuilding the international comparative advantage of labor force in order to consolidate the international status of China’s processing trade. China needs to strengthen R & D investment, promote the technological progress of processing trade enterprises, enhance the innovation ability of enterprises and enhance the level of China’s opening up and processing trade industry connection degree. After this we can Realize the leap of processing trade in the global value chain, make the Chinese processing trade get rid of the high dependence on export support policy, and processing trade can truly promote the transformation and upgrading of economic structure.