A Study Of Sino-Australian Intra-industry Trade In Auto Industry

Auto industry's great impact on national economy is always beyond suspicion. Meanwhile,automotive trade holds a key point in China's International trade.As an important economic entity in the southern hemisphere,Australia should be a substantial trade partner for China.This paper focuses on intra-industry trade in auto industry between China and Australia(within the limits of SITC781-SITC784,corresponding to the HS Code 8701.10-8708.99),analyzing both of the two countries' import and export in automotive products respectively,bilateral intra-industry trade in automotive products, as well as the characteristics of the trading products.Then it calculates and analyzes the GL index of all the products both under the classification of HS Code and grouped by their function.After calculation and analysis on the above index,it comes to a conclusion that the intra-industry trade in auto products between China and Australia are mainly vertical type,while horizontal type takes a relatively small part.After that,it summarizes country factors and industry factors and establishes an econometric model for empirical analysis.The result of the model shows that the difference between each country's average per capita GDP,the industry economies of scale,the level of foreign capital entry and product diversity are four main factors which positively affect Sino-Australian intra-industry trade in auto industry.Through empirical and theoretical studies,the paper eventually makes some relevant suggestions from the perspective of both government and companies,on how to improve Sino-Australian intra-industry trade in auto industry.