Empirical Analysis Of China's Service Trade, Comparative Advantage And Competitiveness

Trade in Services is one of the ever-fast growing fields among the international trade. For more then a decade years, the development of the service trade is faster then that of the goods trade. Because of this, lots of countries have paid more attention to study it then ever before. With the world steps into the service economic era, the competition based on the commercial trade once upon a time has shifted to the competition based on the service trade. The service industry plays an important role in maintaining the countries economy and political benefits, and the service trade has become an important aspect in world economy as well as become a necessary condition for developing global production. It can be possibly pointed out that, with the successive development, at the next stage, trade in services will become the new comer of the international competition and international cooperation. Since 1978's reformation, China has opened herself to the rest countries and made herself emerged in the globalization. During more than 20 years' development, the world has witnessed the outstanding achievements that Chinese international trade, especially the goods trade has made. But in contrast, the development of the service trade is far less then that of the goods trade. On December 11th, 2001, China became one of the official members of WTO. The entry into WTO is a two edged weapon for Chinese service trade, but the challenges weight more against to the opportunities. What's the comparative advantage of Chinese services trade and what's the competitive advantage? After making a brief introduction to the domestic and overseas research on the trade in services, the comparative advantage is analyzed by the conventional factor endowments, then based on the data of Chinese services trade import and export in 2003, 37 and 10 economic modes are established to analyze the competitive advantage. The analysis shows that, the explanation and guidance based on the factor endowments theory is not the right selection to develop Chinese service industry, because the comparative advantage resulted from the factor endowments cannot answer to the national conditions of China. But the theory of competition advantage, however, does a good job. Based on these, the policies and suggestions are brought up.