An Empirical Analysis Of The Impact Of Trade Liberalization On Total Factor Productivity In Xiamen

Under the new and open normal economy in China,increasing Total Factor Productivity(TFP)is an important task to realize the transformation of economic development pattern,at the same time,there are a lot of factors affecting TFP in the developing countries or areas.Based on the background of Supply-side reform in China and the current situation of China(Fujian)Pilot Free Trade Zone,Xiamen district,researching how to make the trade liberalization to promote Xiamen's TFP further has an important practical significance.Firstly,the paper sorts out the basic concepts and summarizes the existing related literatures.Then,according to Falvey,Foster and Greenway(2002)'s method which to measure technology spillovers,and their principle for the empirical analysis,the paper selects TFP of Xiamen as the explained variable,and picks the level of actual utilization of FDI(FD),the strength of R&D expenditures(RD),the degree of dependence on service trade(ST),the technology spillovers of non-processing trade(SPN),the technology spillovers of processing trade(SPP),the degree of dependence on non-processing trade(NGT)and the degree of dependence on processing trade(PGT)as the explaining variables,in the meantime,the paper establishes an econometrics model with Xiamen's time series data during 2000-2012,and researches the influential factors of the TFP and the relationship of all factors under trade liberalization conditions.On the base of the above opinions,to sum up the under conclusions:(1)The strength of R&D expenditures of Xiamen plays an important role for increasing TFP;(2)the increasing of TFP doesn't rely on the degree of dependence on processing trade directly,but rather depends on the international technology spillovers through processing trade channel.At the same time,the processing trade enhances the level of TFP indirectly through promoting the development of non-processing trade;(3)Non-processing trade doesn't have significant influence on TFP due to its poor capacity to accept international technology spillovers;(4)The development of trade in services of Xiamen has a negative impact on its own R&D expenditures,however has a positive impact on the degree of dependence on processing trade;(5)The level of actual utilization of FDI has a certain degree of "crowding out" effect on Total Factor Productivity.Finally,this paper puts forward corresponding suggestions based on empirical analysis conclusions:(1)Reinforcing Xiamen's own strength of R&D expenditures;(2)Advancing TFP through transformation and upgrading of processing trade's structure and making the most of technology spillovers from developed countries;(3)Keeping on increasing TFP through enlarging the product-market openness;(4)Promoting service trade structure high-end and striving to create brand effect;(5)Guiding the flow of FDI to high-tech industry and putting emphasis on the efficient utility of FDI to improve the strength of R&D;(6)Further advancing construction and development of China(Fujian)Pilot Free Trade Zone,Xiamen district.