The Study Of International Trade On The Conduction Mechanism Of The Economic Cycle

The theoretical study on business cycle has become an attracting academic area, since the phenomena of business cycle was found by economists. After that, a great many economists have put forward all sorts of theoretical explanations of the reason that leads to the business cycle. Although there isn't yet a perfect explanation that can accounts for the business cycle completely and exactly, all the economic cycle theories are precious wealth that can help people understand and even to some extent control the business cycle. With the rapid development of economic globalization, more and more international trade and transnational financial activities are undertaken, and it is recognized that the theoretical analysis of business cycle should not be done only within the framework of closed economy. Under the opening economic circumstances, one country can transmit its own economic fluctuation to other countries of the rest world through trade and financial channels, in reverse, the economy of the same country would be affected seriously by other countries in the same way. Consequently, it is worthwhile and of great sense to study the business cycle transmission mechanism of international trade. This thesis intends to expound the business cycle theories and then further study will be given on the trade transmission mechanism of economic cycle, finally the thesis will discuss the economic correlations between China and other countries in the process of both economic growth.In the light of the above thoughts, the basic structure of the thesis is as follows:Chapter one expounds the formation and development of business cycle, in the meanwhile, it also analyzes the main traditional economic cycle theories.Chapter two accounts for the three classical theoretical models of the business cycle, in this chapter, more details are given on the importance of the main economic variables —investment and saving which can make economy fluctuate accordingly.Chapter three studies the international trade transmission mechanism of business cycle, firstly it expounds the function of trade for the economy of one country, and secondly it analyzes the process of the transmission mechanism, which is also the theoretical basis of the next chapter.In chapter four, the author makes an empirical analysis on the economic correlations between nations and the transmission mechanism among nations by using the economic data of different countries.