An Empirical Study On Financial Development Affect The Trade Structure In The Brics

Under the condition of an open economy,international trade has gradually become an important part of economy,and the improvement of the trade structure is also an vital way to enhance the international competitiveness of a country.As the main representatives of emerging economies,the BRICS has shown excellent performance in the international trade market in recent years.The current total trade volume of the BRICS has reached 16.4% of the total world trade.At the same time,the level of financial development in the BRICS is great.This is not only reflected in the rapid expansion of the financial scale,but also the improvement of financial efficiency and the gradual improvement of the financial system.The interaction of the finance and trade becomes increasingly prominent,coupled with the continuous development of international financial theory and innovation,and the relationship between finance and trade become more closely,so the discussion on the relationship between the two has become a hot topic in academia.Based on this reality,this paper first sorts out the influencing mechanism between the two,then combined with the status of the financial development and the trade structure in the countries of BRICS,the paper explores the impact of the financial development of the BRICS on the trade structure in terms of theory and practice from the unique perspective of the BRICS.The article focuses on investigating the threshold mechanism between the level of financial development and trade structure,so it enriches the current research results.It is not only important to the BRICS in how to enhance their trade structure,but also provides reference for some developing countries to promote the upgrading and transformation of the trade structure through financial development.Only by adjusting the financial scale,financial efficiency and financial structure to a certain level,can the optimization of the financial structure for trade be better utilized.This paper uses normative analysis,descriptive statistical analysis and panel threshold test empirical analysis methods.It argues that the connection between the financial development and the trade structure in the BRICS from bowth theoreticaland empirical analysis.The article summarized the channels and theoretical mechanisms of financial development affecting trade structure.Based on the data of financial development indicators and trade structure indicators of the BRICS from1995 to 2015,this paper made an empirical analysis of the relationship between them based on panel threshold model.From the empirical results,the mechanism of the financial development of the BRICS on the trade structure is nonlinear,and there is a significant threshold effect.The impact of financial development to trade structure will be different in the level of significance,direction of action and intensity of action before and after the threshold value.This article uses financial scale,financial efficiency and financial structure to represent the financial development,and take the corresponding three indicators for empirical test.We found that when the level of financial development crosses the threshold value,the coefficient value is generally positive and the coefficient becomes larger,and compared before the threshold,the promotion of trade structure is even more significant.This shows that a certain degree of financial development can promote the transformation of the trade structure from a lower level to a higher level,and that the financial development is more conducive to the upgrading of the trade structure within a certain range.Therefore,the BRICS should continue to expand the financial scale and enrich the financing channels for SMEs;improve financial efficiency and promote the optimal allocation of financial resources;improve the financial structure and credit structure,and strengthen financial support for the technological innovation of exporting enterprises;strengthen financial and trade cooperation between the BRICS and deepen the integration of regional economy so as to promote the trade structure.