Empirical Analysis Between Real Exchange Rate Of RMB And Import & Export Market Structure

This thesis is aiming to carry out empirical analysis to examine the correlations between RER of RMB and import and export structure. In the first place the paper set up mathematical model with regard to the exchange rate affecting import & export market structure through mechanism analysis, and calculated the requirement which the demand price elasticity must satisfy when the exchange rate devalues or revalues, the export or import proportion to each country raises or reduces. Secondly the paper calculated the import and export demand elasticity of five trade partners respectively through Regression and the elasticity definition link with exact and gross calculation. Thirdly, there are three regressions between RER of RMB and import and export market structure during 1981-1994, 1995-2003 and June of 2005–July of 2006 respectively through panel date under the background of different exchange rate system . The results of empirical analysis show that the empirical results between RER of RMB and the import portion to EU and JAP and the import and export portion to USA are same to mechanism analysis ,but the empirical results between RER of RMB and the export portion to Japan and EU and the import portion to Singapore are different from mechanism analysis .Fourthly, adding the variable of FDI structure, a simultaneous equation is set up which connect RER of RMN and FDI structure with import and export structure directly under the same theoristical framework , there is an empirical analysis through TSLS among RER of RMN , the structure of FDI and import and export structure .The results explain the contracdict between the empirical results between RER of RMB and the export portion to Japan and the import portion to Singapore and mechanism analysis very well. In the end ,this paper analyzes the long-run short-run and dynamic effects of REER to EXCI,IMCI by cointegration,Granger cause,ECM,Variance Decomposition and Impulse Responses ,the result of cointegration shows the long-run equilibrium relationship exists between REER and EXCI,IMCI ,in the long-run effect of REER to EXCI,IMCI is negative ,that is to say the revaluation of RMB does good to diversity of import and export market structure. Granger cause shows REER is the cause of only IMCI, Variance Decomposition and Impulse Responses prove the result of Granger., The empirical results provide theory basis to which our country will carry out the strategy of export market diversity and the adjustment of the exchange rate according .