Beijing Foreign Trade And Economic Development Empirical Analysis

To propel the economic growth of a country or region is the most important function of foreign trade. In retrospect of those countries that have realized quick economic growth in recent years, international trade has almost always played the important role of a propeller. Global economic growth proves the conclusion. China's economic development path also demonstrates such a fact. That is, since economic reform, economic development speed is evidently quicker than before and the economic growth rate enhanced greatly. As the outside factor of economic growth, foreign trade has received much attention from researchers. The relationship between foreign trade and economic growth and the way in which foreign trade influences economic growth are important problems that nations must face while designing economic development strategies.This paper first takes a retrospect of foreign trade theory development. There are three stages in the history, classical trade theory, neoclassical trade theory and new trade theory, including such representative theories of absolute cost, product factor endowment and product life cycle. Difference exists in the thoughts and theories on different stages, and this lead to different developing strategies. On the economic growth theories, this paper mainly discusses Harold-Domar model, Solow's neoclassical growth model and new economic growth theory. Then the theory of foreign trade propelling economic growth, and extra product export and economic growth engine theory are also introduced. The mechanism of foreign trade propelling economic growth is analyzed from both import and export aspects.About the relationship between foreign trade and economic growth, domestic and foreign researchers have made a lot of study and different conclusions are drawn out. However, quantitative relationship between them has not been categorized explicitly. In the paper's empirical study part, the relationship is analyzed in detail empirically with econometric methods based on established theories. And explicit conclusions are achieved in categories. First, cointegration theory is introduced briefly as this paper's econometric base. Then with Eviews5.0, and cointegration theory and ECM model, categorized data of Beijing import and export goods from1986 to 2004 are tested by unit root test, cointegration test, J-J test. The last part makes some proposal about foreign trade propelling economic growth.The main point of this paper is that import and export goods are categorized in detail, so that propelling effect of different goods in Beijing to economic growth are studied and conclusions are drawn in this condition. The conclusion can be a good reference for governmental departments of Beijing to design correctly foreign trade policy and for enterprises to do foreign trade.