A Study For The Effect Of FDI On Chinese Trade Structure Under The Frame Of Network

In recent 20 years, as a great processing trade country, the development of China’s intermediate trade becomes more and more quickly, and intermediate goods trade has become an important component of China’s import and export trade. Intermediates import of China will have great impact on final product trade. Multinational corporations play an important role in the intermediate goods trade. So under production the network perspective, research on how FDI affects the export of the final product through the intermediate import of China is very necessary. In this paper, through production network perspective, use general equilibrium theory to study the effect of FDI on the trade structure. Firstly this paper uses charts and statistics methods to introduce present situation of FDI and trade development and concludes its characteristics to find the inner relationship between them. Secondly, conclude the relationship of replace and complementation between FDI and trade based on the research of predecessors. Using general equilibrium analysis, elaborate the mechanism between FDI and intermediates, final products trade pattern. Next this paper using the gravity model, studies empirical analysis of the FDI, intermediate and final products trade.Then do empirical study about the relationship between FDI, intermediates and final products trade by OLS and panel data model. Conclude that in the triangular trade, FDI has played a positive role in promoting the import of intermediate. While semi-finished products and components promote the export of final capital goods, intermediates in the import of primary products promote the export of the final consumer goods. As a great processing trade, China’s FDI formed complementary relationship final products export through intermediates.What’s more, this paper also find the more similar the level of bilateral economy is, the greater proportion of intermediate products trade is. There is a significant positive effect between GDP and intermediates, final products trade. At last, this paper put forward the relative policy suggestions.