China's Participation In The Industrial Technology Of Vertical Specialization Upgrade Effects

Technological progress and technological innovation is fundamental to sustainable economic development and the enhancement of the core competitiveness of a country.There have been a lot of researches on Technological progress domestically and abroad.FDI,international trade and R&D investment are the main reasons for the promotion of technological progress.According to statistics,China's import and export's value of high-tech products amounted to 634.8 billion U.S.dollars in 2007,which was 111.3 times of the value in 1986.The high-tech exports accounted for 28.6%of the total merchandise exports,which was 26.3 percent more than the share of 2.3%in 1986.This indicates that high-tech exports played a more and more important role in China's foreign trade.From 1981 to 2007,China has made a total of major provincial and ministerial level scientific and technological achievements over 746,000;awarded a total of 842 National Natural Science Awards,2962 State Technological Invention Awards,and 10099 State Science and Technology Progress Awards.The remarkable success achieved by China on Technological progress and innovation since reform and opening has led to a wave of the academic study of the technological progress.With the diversification and frequency of international cooperation and communication, it's more and more important to improve one's technologies through the strengthening collaboration with other economies in the world.As the globalization proceeded and deepened and barriers to international trade and investment eliminated,world economy get integrated increasingly and many remarkable changes happened.International specialization has stepped from the horizontal specialization into the era of vertical specialization more broadly and deeply and it has infiltrated to every comer of the world economy.International economic integration didn't bring the integration of forms of international specialization.The different manufacturing processes and links were scattered in different countries and therefore the processes and links-oriented international specialization step onto the stage.The emergence of vertical specialization implemented the Ricardian theory of comparative advantage from product to product's internal processes and procedures,which lead to changes in operating mode of the global economy,through theoretical analysis and empirical testing on China's participation in the vertical specialization and the upgrading of industrial technology effects,using econometric model analysis of the data of 1992-2007,we found that the vertical specialization promote technology much higher than international trade and investment in research and development.This article also analyzes the differences of the technological effect of vertical specialization among different industries.Vertical specialization's impacts on different industries are not in the same degree.This results from industrial characters,such as relationships with other industries,industry technical standards and the openness.Through these analyses,this paper presents advices on how to make better use of vertical specialization to improve the level of China's industrial technology.