A Study On How Trade Policies Affect Export Trade Value

Since China's reform and opening up, China's foreign trade policy has continuously adjusted for several times according to the development of Chinese economy, which made huge contribution to China's economic and trade development. Through the implementation of trade policy tools alone or in combined forms, trade policy goals can be achieved and better trade performance can be gained. Trade policy tools has also effectively adjusted the import and export trade scale and structure in different stages of China's economic development phase.This paper firstly set up a basic framework of China's foreign trade policy based on terms of Foreign Trade Law of the People's Republic of China. We distinguish different trade policies by the way it affects export trade, and we divide China's trade policies into five groups:the tariff policy, the export quota and licensing policy, trade related financial support policies, trade related intellectual property rights (hereinafter referred to as IPR) policy, FDI utilization policy and outward overseas investment policy (hereinafter referred to as OFDI policy). Next, we reviewed on the history of each policy tools:combining theory with economic data, we analyzed how each trade policy tools affect the export scale. The preliminary analysis reveals that the use of trade policy tools which promote export trade(including export subsidies, export tax rebates(hereinafter referred to as ETR), export credits/financing, IPR protection, utilization of FDI, encourage of OFDI) can boost export trade, while the use of policy tools which inhibits export trade (including export tariffs, export quota and license) will limit the export scale of high-energy-consuming and resource-dependent products, which effectively optimize the export commodity structure of China.This paper also measures the mechanism of policy tools' effects on export scale by selecting corresponding indicators to conduct regression analysis based on the monthly data from Jan.2010 to Dec.2014, in order to find out how policy tools promote export value on a national level. Regression results showed that the ETR policy, financial support policy, IPR protection policy, FDI utilization policy, OFDI policies can stimulate China's export scale. In addition, by establishing a panel data model, we analyzed how different policy tools work together upon 26 provinces during 2003 to 2014. The local level results reveal that the local governments' implementation of FDI utilization policy and IPR protection policy stimulate export scale more than implementing OFDI policy. It also shows that local implementation of trade policy tools works better on increasing export value than local labor endowment does. According to the results of the empirical research, we put forward some corresponding policy suggestions about trade policy formulation and implementation in China at both national and local level.