The Influence Of Institutional Distance On China's Bilateral Trade With Countries Along Belt And Road

Since the reform and opening up,China's economy has achieved remarkable achievements and has made tremendous contributions to the growth of the world economy while developing its own economy.China's economic development has largely benefited from foreign trade.By relying on its own resource endowment advantages,China has become a veritable trading power.Along with the supply-side reform,the endogenous driving force of China's foreign trade has been continuously strengthened,and it is gradually changing from a large trading country to a trading power.However,the trade environment facing China at this stage is still not optimistic.Although the world economy has experienced a short-term recovery,the factors supporting the long-term growth of the world economy have not been formed.The economies of various countries are still weak and the international market demand is insufficient.At the same time,the macroeconomic policy spillover effect of developed countries is obvious.Geopolitics and terrorist activities also bring great uncertainties to global economic growth.The "US-first" trade protectionist policy introduced by Trump after it took office has caused a great threat to China's foreign trade.The long-term trade surplus has made many countries regard China as the primary target of trade protectionism.At the same time,China's foreign trade is in the stage of transition from high-speed growth to high-quality growth.The traditional competitive advantage has weakened and new competitive advantages have not yet formed.Under this background,how to develop trade with countries along Belt and Road will be realized.It is particularly important for China's economic growth to drive economic development along the Belt and Road countries.There are many countries along the Belt and Road,and the system is quite different.The system may have spatial spillover effects on the trade between neighboring countries and China.Therefore,this paper plays a role in the bilateral trade between China and the countries along the Belt and Road.The role is studied in depth.This paper firstly introduces the research background,expounds the theoretical significance and practical significance of the research,and combs the relevant research at home and abroad.Based on this,the research ideas and research methods of this paper are established.Secondly,this paper introduces China's foreign trade situation,and then analyzes the challenges and current situation of China's trade with countries along the Belt and Road.Thirdly,this paper introduces the theoretical approach to the path of bilateral trade from the aspects of human capital,technological innovation,economies of scale,transaction costs and consumption.Finally,select the data of 42 countries along the Belt and Road from 1998 to 2017 as a sample,and build the space measurement model to import and export the neighboring effects and the spatial spillover effects of institutional distance in China and the countries along the Belt and Road.And the role played by trade volume has been studied.Taking into account the regional differences in the countries along the Belt and Road,the sub-regional analysis of the role of institutional distance in China's trade with countries along the Belt and Road was conducted.At the same time,because the spatial spillover effect of formal institutional distance is not significant,this paper also divides the formal system into three dimensions: legal system,macroeconomic system and microeconomic system in the empirical analysis,and the system distance in China and the Belt and Road.A more in-depth study of the role played by countries along the line of trade is expected to provide more accurate and reasonable recommendations for China to better trade with countries along the Belt and Road.The research in this paper shows that:(1)The economic scale and geographical distance between countries are still an important factor influencing the trade volume between countries.Whether it is from the results of the full sample regression or the sub-regional and the results of the formal system sub-dimension,the trade volume between China and the countries along the Belt and Road is inversely proportional to the geographical distance between the two countries and the economies of the two countries.The scale is proportional.(2)Institutional distance has a significant role in promoting bilateral trade and there is a spatial spillover effect.The formal institutional distance and informal institutional distance are significantly positively related to China's trade with countries along the Belt and Road.China's trade with countries along the Belt and Road Initiative is complementary.(3)The trade performance between China and the countries along the Belt and Road is positive.In terms of imports,exports or total trade,China's trade with countries along the Belt and Road is affected by trade between China and its neighbors,and the expansion of trade between China and its neighbors is on China's and trading countries.The scale of trade has a significant role in promoting.At the same time,this positive neighboring effect is similar in terms of imports,exports,and total trade,and the adjacent effects in different regions are similar.