The Research On Intra-product Specialization And Industrial Upgrading Of China

With the development of modernscience and technologyand the progressofproductivity,economic globalizationbecomesan irreversibletrend,andInternationaldivision of labor andspecialization and cooperation has stepped into ahigherstage.The production which did in one country in the past was scatteredtoseveralcountries and evendozens of countriesfor production, and each countryjustfocus oncertain link of production or someparts of the production, which calledIntra-product specialization. In the form of the Intra-product specialization, theperformance of industry structure upgrading not just means the center of one country’sindustrial structure upgrading from the first industrial to the second industrial, then tothe third industrial, but also means upgraded from the low value-added links to thehigh value-added links of the production along with the value chain.As to the intrinsic motivation of the form of the Intra-product specialization,Western economics consider the Intra-product specialization as a purely naturalprocess, and attribute the intrinsic motivation to the power of abstract reciprocal tradein a framework of traditional International Trade Theory, which inevitably lead to thedeveloping countries engaging in the low position of the value chain of productionprocesses. However, Marx’s international value theory ascribes the intrinsic motivationto the nature of capital of the pursuit of residual value. When capital can’t gain enoughresidual value in the existing system of international division of labor, it will break therestrictions on it, and create a new form of international division of labor.As to the distribution of benefits between developed and developing countries toparticipate in the Intra-product specialization, Western economics focus on theallocation of resources from a purely technical analysis point of view, and whether thefactor endowments of countries to achieve the optimal configuration becomes thejudgment of a reasonable standard of the Intra-product specialization, it also has a viewthat every country can gain profits only if it participate in the Intra-productspecialization following the principle of comparative advantage. However, thismethodof analysis obscures thereality ofexploitationin developed countriesto developing countries. In the view of Marx’s international value theory, the law of value stillfunctions in the international market. Due to differences in labor productivity betweendeveloped countries and developing countries, the former gain more value with lesslabor under the conditions of equivalent exchange, and gain the surplus value createdby workers in developing countries without any costs, which causes a very unevendistribution of benefits on the "smile curve".At present, China has become an important player in the Intra-productspecialization, but it has stayed at the lowest end of the global value chain for a longtime. There are two completely different paths about how to upgrade industrialstructure of China based on two different theories. Through a comparative analysisfrom the angles of technological progress, improving the quality of workers and theuse of foreign capital, it can be seen that the first path based on Theory of comparativeadvantage not only has a strong dependence on core technology of developed countries,but also pay the costs of environmental pollution and excessive consumption ofresources, even threaten the security of industry. However, the other path based onMarx’s international value theory impresses the development of independentinnovation capability of our nation, the improvement of the core competitiveness ofdomestic industries and the caught up with developed countries.Therefore, it is difficult to achieve the national industrial structure upgrading byparticipating in the Intra-product specialization in accordance with the principle ofcomparative advantage for China at the low end of the global value chain. To get rid ofthis unfavorable situation, we must rely on the power of the state, to accelerate theprimitive accumulation of capital, protect and support domestic enterprises andindustries, especially the strategic enterprises and industries with independentintellectual property rights, achieve technological leap and form our own competitiveadvantage.