Empirical And Theoretical Analysis For The Impact Of Regional Trade Liberalization On China’s Economic Growth

As an important carrier of regional economic integration, Regional free trade agreements have been increasing rapidly and their form of organization is constantly increasing and innovating since the early 1990s.The level of Economic integration also is improving. As a big developing country, China should participate in regional trade liberalization actively and take it as an important link to contact China’s economic and the world’s economy at post-WTO era. So, the measurement of regional trade liberalization’s effect on economic growth has become very important.In this paper, we discuss how the regional trade liberalization affect China’s economic growth using theoretical and empirical analysis.Firstly, we analyze the situation of China’s trade liberalization at present, mainly from the expansion of the partners and tariff reduction of China. The results show that the number of free trade partners is increasing, and the content and the forml involved are constantly advancing.Secondly, we analyze the influence of regional free trade agreements’formation and augment to country’s welfare by establishing game model, assuming that the degree of regional trade is mainly reflected in tariff reduction. The results show that there is beneficial effect. Thirdly, based on China’s statistical data over the period 1992-2008, we measure the level of China’s trade liberalization through the calculation of three integration index. Then the empirical model is built and discussed mainly from the influence of integration to GDP per capita and investment. We also analyze the relative contributions of integration-induced technology-led growth and integration-induced investment-led growth. The studies find that the improving of integration level has great role in promoting economic growth, mainly through promoting investment and technology spillover. And investment gets two thirds of the role of improving.Finally, in combination with the development of China’s regional trade liberalization, we put forward some relevant policy suggestions in order to promote the economic growth more rapidly.