The Impact Of Immigration On China’s International Trade

This thesis is aimed to study the impact of international immigration on China’s trade.In the study,China is chosen as the home country and 128 trading partners are selected as destination countries for Chinese immigrants.This thesis concludes international immigration can promote the home country’s trade and furthermore also provides policy recommendations for China’s talent development and attracting overseas talents in the 13th Five-Year Plan.With the theoretical framework of theories on international migration and international trade to build on,this thesis has reviewed the literature home and abroad from the perspective of immigrants’ social network,the impact of immigration on international trade and empirical studies both on developed countries as destinations of immigrants and on developing countries as origins of emigrants.The empirical study uses panel data and Chinese immigration population from 2000 to 2015 annualized in the linearized and modified trade gravity model.Considering the minor immigration population change compared to the population change in the two countries year by year,this thesis selects the data of 2000,2005,2010,2015,every five year.Through the empirical test of China’ s international trade,when the fixed factor of distance and variable factors of bilateral GDP product,bilateral population product and migration population are included in the Pooled Model Ordinary Least Square regression along with the dummy variables of language and colony,immigration has a significant and positive effect on total trade volumes and exports but an insignificant positive effect on imports.This insignificant effect can be explained through product structure effect.When the distance,language and colony are controlled in fixed effect regression,immigration has a significant and positive effect on total trade volumes,exports and imports.This significant positive effect can be explained through the immigrant preference effect,transaction cost effect and export-oriented effect.Besides,we can see that the influence of GDP and bilateral population on China’s international trade is positive and significant.However,the influence of space distance on international trade is significantly negative.The colonial ties have insignificant and negative.This thesis also plays a certain guiding role for China to formulate immigration strategy.It should be noted that the impact of a large number of Chinese immigrants can promote China’s bilateral trade so this a significant factor when making immigration policy.To smooth the people flow,China’s government is expected to simplify the visa process,for example to increase the coverage of visa-free countries or visa-upon-arrival countries among the selected countries with close trade and immigration interaction with China.Furthermore,it is of vital importance for the government to promote China’s talents engaging in the International events.China’s government should emphasize on training more international leaders in order to better participate in the global political,economic and cultural events.Meanwhile,to be more competitive in the globalization,China’s government should deepen the international talent policy openness and expand the talents coverage to better support and implement the policy of introducing overseas talents and smoothing the returning channel stated in the 13th Five-Year Plan.This thesis also recommends establishing a mature system of bringing overseas talents back,which will effectively address the concern of brain drain.Therefore,the government should further improve the system of permanent residence of foreigners to provide incentives for attracting international talents.