Study On The Influence Of Rmb Exchange Rate Changes And Neighboring-country Effect On Bilateral Trade

The impact of exchange rate on international trade is a problem that many scholars have been studying deeply.The traditional research framework of exchange rate movements affect the bilateral trade between the two countries usually only consider the factor of the two countries respectively,while ignore the effects of neighboring countries or some influential countries,such as the United States,Japan and other developed countries.From the beginning in 1980s,some foreign scholars began to study on the neighboring-country effect between the bilateral trade from the theoretical and empirical aspects,while domestic scholars began to pay attention to this problem in recent years.Therefore,this paper combines with "The Belt and Road" which is the most important national strategy and has important academic value.Firstly,this paper systematically reviews the related literatures about bilateral exchange rate changes and neighboring-country effect affecting bilateral trade,and then discusses the mechanism of the neighbouring-country effect affecting bilateral trade.On the basis of literature research and mechanism discussion,this paper puts the neighbouring-country effect into the traditional research framework of exchange rate changes affecting bilateral trade,and uses the spatial econometric analysis method to construct the static and dynamic spatial panel models respectively to study the neighbouring-country effect and the bilateral RMB bilateral effect on the bilateral trade between Chinese and the countries alongside "The Belt and Road" from the two layers of the whole and the industry.The research indicates that:(1)the economic development level of the importing country is the main factor affecting the bilateral trade between China and the countries alongside the Belt and Road.(2)the rise of bilateral exchange rate will negatively affect China's import and export trade with countries along the Belt and Road,and there is a certain time-lag effect.(3)bilateral exchange rate changes have little impact on the bilateral trade between China and countries along the The Belt and Road.(4)There is a significant positive neighbouring-country trade effect on the bilateral trade between Chinese and the countries alongside "The Belt and Road".It means that the growth of China's export and import with a certain country will promote the growth of China's export and import with this country's neighbouring countries,this effect is more similar to promote an area's import and export trade.It demonstrates that the mode of international trade between China and the countries alongside "The Belt and Road" is a"win-win" rather than a "zero-sum game",and China is working hard to promote multilateral cooperation and common prosperity of countries along "The Belt and Road".(5)Due to the possibility of some exchange rate linkage between countries along "The Belt and Road" and the changes of import and export manufacturers' expectation which is caused by the neighboring countries' exchange rate changes,the changes in the exchange rate of neighboring countries have significant negative effects on exports and significant positive effects on imports.The fluctuation range of exchange rate in neighboring countries has no significant influence on import and export.In addition,this paper also studies from the industry level,and finds that most industries also have positive neighboring-country trade effects.This empirical results further confirm the overall conclusions.According to the above conclusion,this article tries to explain it from the exchange rate linkage,exchange rate expectations and financial market development,and gets many policy suggestion.