A Study On International Fragmentation Of Production And China's Manufacturing Export Development

Since the reform in 1978, as implement of Export Oriented strategy, China's export achieved tremendous growth. As a result, the world ranking of China's total exports raised from the 28th in 1980 to 2nd in 2007 and China has become the biggest export countries in the world in 2009. Manufactured goods export accounted for most of China's export share, and it has growth faster than the total export. Manufactured goods is the main product that produced by international fragmentation of production in China. The international fragmentation of production, the production process of a product is fragmented into some segments and locate different countries and regions, has become an important factor in China's manufacturing export.International fragmentation of production is ignored in Traditional International Trade Theory. So it cannot explain the influence of international fragmentation production on export trade. Therefore, this dissertation develops a South-North international fragmentation of production model, and provides a theoretical analysis framework to analyze the influence international fragmentation of production on manufacturing export. On the other hand, the related experience research about China's export trade mainly from focus on the macro-level, which mainly analyzed the determinant factors of trade volume growth. Few studies involved industry level, and few studies analysis of the characteristics of China's export products such as export sophistication, the intensive and extensive margin of export. No literature researched the relationship between the product features of China's exports and international fragmentation of production. One hand, this dissertation uses the Traditional International Trade Theory and the New Trade Theory, and it adds the international fragmentation of production into the analysis framework; another hand, Select the comparative advantage indices and export structure index,export sophistication, the intensive and extensive margin of export as export development representative indexes, and analyses the influence of the international fragmentation of production on export comparative advantage and export structure. This dissertation analyses emphatically the relationship between the international fragmentation of production and China's export sophistication, the intensive and extensive margin of China's exports theoretically and empirically.This dissertation includes eight parts.Introduction explains the motif, structure and contributions of the study.Chapter 1 outlines the related literature about international fragmentation of production and trade, and about export development.Chapter 2 develops a South-North international fragmentation of production model based on Dixit-Stieglitz (1977) model, in which production activities are divided into different segments and spread over different countries, and analyzes the influence international fragmentation of production on manufacturing export.Chapter 3 Constructs three measure indexes of the international fragmentation production of the manufacturing based on related literature, and measures the international fragmentation production of China's manufacturing.Chapter 4 Compares China's comparative advantage and the structure of manufacturing export, with and without international fragmentation of production.Chapter 5 firstly constructs an index to measure China's manufacturing export Sophistication, secondly analyzes the influence international fragmentation of production on manufacturing export Sophistication empirically.Chapter 6 firstly construct the index to decomposes the intensive and extensive margin of China's manufacturing exports Chinese export, Secondly analyzes the influence international fragmentation of production on the intensive and extensive margin of China's manufacturing exports empirically.Chapter 7 concludes the dissertation and points out the possible directions for further research.This dissertation arrives at the following major conclusions.First, as North country segments some fragments toward South country, it will affect the South country comparative advantage, export sophistication, the intensive and extensive margin of China's manufacturing exports.Second, the degree of international fragmentation production of China's capital or technology-intensive industry is high, and the degree of international fragmentation production of resource-intensive industry is low. The degree of international fragmentation production of manufacturing between China and North America, Asia is the highest, that between China and Europe, Latin American is in the intermediate level, that between China and Africa, Australia is the lowest.Third, when eliminate the effect of international fragmentation production, the comparative advantage of Chinese manufacturing decreases in general obviously, and China's manufacturing export structure improvement is decreased too.Fourth, China's manufacturing export sophistication shows ascendant trend. With the increase of investment in science and technology in China, and with China participate in international fragmentation production through FDI and processing trade more and more, China's manufacturing export sophistication is improved.Fifth, the export shares of Chinese manufacturing industries export Change mainly comes from the contribution of intensive margin of export, the contribution of extensive margin of export is very small. The influence of international fragmentation production on the intensive and extensive margin of Chinese manufacturing export is different between resources or labor intensive industries and capital or tech-intensive industries.