How Does The Heterogeneity Of FTA Affect Bilateral Trade?

Trade agreements have become an important policy tool for the promotion of bilateral trade and economic integration.Since 90s of the last century,free trade agreements develop rapidly.However,due to the difficulty of the global trade negotiations and the slow development of global multilateral free trade agreement,more and more countries tend to establish a free trade area with the relevant countries to reduce tariff and access market.The rapid development of the FTA is affecting the operation mechanism of the international economy and trade,so it is particularly important that how to sign various FTA to improve the level of trade facilitation and further promote the growth of international trade.Meanwhile,as the number of trade agreements between countries has increased,scholars have begun to pay attention to the impact of trade agreements on international trade,and analyze their effects in the method of two variables or homogenization.However,due to the different contents,coverage and related rules and regulations of the trade agreement,the current research has been unable to meet the needs of reality.From the perspective of heterogeneity analysis,this paper makes textual analysis and mathematical assignment for the contents of free trade agreements which China has signed.Based on the gravity model,using panel data for 2001-2015 years from Chinese and the 11 countries along The Belt and Road,we empirically discuss the specific mechanism of the FTA and the influence mechanism of heterogeneity on bilateral trade between countries.The research shows that there is heterogeneity in the content of the FTA;the heterogeneity of the FTA has significant impact on bilateral trade between China and its trading partners.Among them,the terms of trade in goods and the terms of service trade significantly promote trade between China and its trading partners,but the terms of trade remedy and technical barriers inhibit the trade between countries,while investment has no significant impact on bilateral trade;the weighted average tariff rate index that calculated by the terms of trade and the terms of trade remedy has a significant negative effect on bilateral trade;the weighted average index of non tax reduction calculated by technical barriers,investment and service term has a significant role in promoting bilateral trade.Identifying the difference of trade effects between the two sides of the FTA has certain guiding significance for China to sign the regional economic integration agreement;in the process of speed up the opening of our country,this paper can provide a reference for the FTA negotiations and the direction for China and the countries along the Belt and Road in the future.