Study On Influential Factors Of Intra-industry Trade Of Agricultural Products Between China And ASEAN

For a long time, agricultural products are regarded as perfectly competitive products, thus, they rarely appear in intra-industry trade studies. But in fact, there also exist product differentiation and increasing returns to scale in the process of agricultural products’ production. And with the continuous improvement of agrotechnology and the gradual maturity of agro-processing technology, agricultural production based on economies of scale and the production differentiation phenomenon of the type and quality of agricultural products have been very normal. Thus, since the 1990 s, intra-industry trade of agricultural products has received more and more recognition and attention from scholars. At present, both the current situation of Chinese agricultural industry and international trade circumstances are crying for actions to promote intra-industry trade development of agricultural products. And from the perspective of natural conditions, geographical location and political environment, ASEAN is the prior selection to develop intra-industry trade of agricultural products with China. Under this background, it is of great theoretical and practical significance to study influential factors of intra-industry trade of agricultural products between China and ASEAN.This paper firstly reviews theoretical studies of intra-industry trade and empirical studies which are about influential factors of intra-industry trade. Then, Trade development situation of agricultural products between China and ASEAN is summarized. Next, GL index and AE method are applied to measure and decompose the level of intra-industry trade of agricultural products between China and ASEAN and descriptive analysis about its characteristics are made. And then, panel data models which take subdivided agricultural industries as individuals are established to analyze influential factors of total intra-industry trade, horizontal and vertical intra-industry trade of agricultural products between China and ASEAN. In the end, research conclusions are generalized and relevant political suggestions are offered.The results indicate that of all the influential factors, income per capita of two countries, trade openness of ASEAN countries, American subprime crisis and differences in agricultural tariff rates significantly promote total intra-industry trade of agricultural products between China and ASEAN, while differences in income per capita between two countries, China’s actually utilized foreign direct investments of ASEAN countries and imbalance of trade on agricultural products significantly restrain bilateral total intra-industry trade of agricultural products; American subprime crisis significantly promotes horizontal intra-industry trade of agricultural products between China and ASEAN, while differences in per capita income between two countries, average market scale of two countries and imbalance of trade on agricultural products significantly restrain bilateral horizontal intra-industry trade of agricultural products; trade openness of ASEAN countries significantly promotes vertical intra-industry trade of agricultural products between China and ASEAN, while China’s actually utilized foreign direct investments of ASEAN countries and imbalance of trade on agricultural products significantly restrain bilateral vertical intra-industry trade of agricultural products.Based on beyond conclusions, this paper puts forward following political suggestions to promote the level of intra-industry trade of agricultural products between China and ASEAN: The first is to shrunk the trade deficit of land-intensive agricultural products; the second is to intensify the horizontal differentiation characteristics of agricultural products; the third is to deepen the trade cooperation of agricultural products with ASEAN countries selectively; the fourth is to accelerate the flow of production factors; the fifth is to reasonably control and guide foreign direct investments.