RMB Appreciation,Technological Innovation And Enterprise Export Competitiveness

Since the reform and opening up,China's foreign trade has grown rapidly,and now it has become the world's first trading nation.Meanwhile,the RMB exchange rate entered the appreciation channel after the ‘721 exchange rate reform'.While the exchange rate appreciation weakens the price advantage of enterprises.In this moment,Chinese companies can only rely on increasing investment in technological innovation to improve product quality so as to reshaping trade competitiveness.Based on the industry panel data of China's manufacturing industry from 1996 to 2016,we laid special stress on analyzing the impact of RMB appreciation on technological innovation of enterprises,and its improvement in export competitiveness,through technological innovation as a media.Based on current literature,we first summarize the effect and mechanism of exchange rate technological,innovation and export competitiveness.It also analyzed the limitation of previous researches and new directions are proposed.Secondly,we constructed an endogenous decision model of export competitiveness,comparing the innovation decision-making and the change of export competitiveness with or without the attack of exchange rate shock.In these theoretical circumstances,we put forward some hypotheses.Thirdly,the dynamic panel model and panel ARDL model are used to verify the above hypotheses,and further analysis is made to screen the difference of the impact under different exchange systems and the different level of technology industry.Finally,the following empirical conclusions are obtained: First,the appreciation of the real effective exchange rate has significantly induces the technological innovation of Chinese enterprises,which can turn the trade competition pressure brought by the appreciation of RMB into the driving force of technological innovation.Second,technological innovation can promote the export competitiveness.Third,technological innovation,triggered by RMB appreciation can lead to the improvement of export competitiveness in the long run.Fourth,the impact of government funding,FDI,material capital intensity and number of scientific and technological institutions on enterprise technological innovation is positive;Financing constraints inhibit technological innovation;But the effect of financial support on technological innovation is unclear.This paper focuses on the sustainable and healthy development goals of enterprises,and puts forward the following policy suggestion from the three aspects of monetary policy,fiscal policy and financial policy: First,the formulation of monetary policy should focus on the long-term goal of supply-side structural reform,creating a good monetary environment for enterprises to improve their quality competitive advantage.Second,the deepen reform the exchange rate formation mechanism should gradually weaken the role of the us dollar in a basket of currencies,and strengthen the multilateral significance of RMB internationalization,so as to fully reflect market changes and provide real price information for the enterprises.Third,the Chinese government should continue to spare no effort to support enterprise innovation,giving full play to the guiding role of the financial funds in enterprise innovation,and providing institutional support for them.Fourth,it is essential to break the shackles of financial reform,reducing the credit constraints.We makes the following contributions: First,the experiential fact verifies that the exchange rate promotes the export competitiveness of enterprises through inducing technological innovation,which providing a new perspective for comprehensively understanding the relationship between the monetary policy,fiscal policy,institutional environment and economic growth.Second,exchange rate appreciation promotes the improvement of technological innovation capability of Chinese enterprises in the stage of R&D and commercialization.These findings enrich the theory of exchange rate "promotion" on technological innovation and provide empirical evidence for truly understanding the innovation activities of Chinese enterprises.Third,according to ‘721 exchange rate reform' and the technical level,the sample is divided into before and after reform,low and high industries which can be better understand the relationship between exchange rate,technological innovation and export competitiveness.This classification study is helpful to further analyze the "catch-up strategy" of high-tech manufacturing industry.