The Research On The Trade Effect Of Preferential Rules Of Origin In China-ASEAN Free Trade Agreement

Preferential rules of origin are regarded as an important part of China-ASEAN free trade agreement.While determining the "legal nationality" of trade products,their severity not only affects the flow of trade and investment decisions among countries,but also have influences on the welfare effect of the parties to the free trade agreement.Generally speaking,reasonable preferential rules of origin benefit to the allocation of resources in the FTA and promote the trade between member states.However,if the preferential rules of origin were too strict for member enterprises,their cost will be more than advantages of preferential treatments,which makes firms have to get rid of the preferential rules of origin.Therefore,trade flows of investment decisions of countries are restricted,the trade creation effects and welfare effects are reduced as well.As the first free trade agreement signed in China,the preferential rules of origin of China-ASEAN free trade agreements are choose.Focusing on measuring the restrictions of the rules on specific industries is to find existing problems in the whole set,which is of great practical significance for Chinese free trade agreements.Firstly,this paper introduces the concept,classification,application and function of preferential rules of origin,as well as the relative literature between home and abroad.From the theoretical level,we summarize from welfare effects,contents and applicable standards.While from quantitative index of preferential rules of origin,economic effects and influencing factors,we finish the literature from the empirical level.Through systematic study,China-ASEAN preferential rules of origin are considered as the research object.Secondly,based on PPML fixed effects model through the trade data of China-ASEAN products under HS6 code from 2007 to 2017,the trade constraint effect of preferential rules of origin is empirically analyzed.By replacing independent variables,dependent variables and industrial data for robustness tests,the above conclusions are still convinced.In addition,this paper tries to deal with the endogenous problems caused by reverse causality from the perspective of industrial development and MFN tariff.In the meantime,expansive discussions on industrial heterogeneity and the influencing factors of preferential rules of origin are also shown.To sum up,on the basis of the above analysis,this paper puts forward policy suggestions on the improvement of China's preferential rules of origin in the future.Only by making them standardization,harmonization and function,preferential rules of origin become more efficient,perfect and reasonable,which promote the utilization of certificates and the construction of free trade area.