Study Of The Influence Factors On Intra-industry Trade Of Manufacturing Industries Between China And The ASEAN

With the continuous development of economies, the Political and economic cooperation between China and ASEAN is getting closer. On January 1,2010, after ten years’building, China and ASEAN Free Trade Area announced a full completion which meant the economic and trade relations between China and ASEAN came into a new stage. By 2012, the bilateral trade volume between China and ASEAN amounted to more than $400 billion, ASEAN rose to the third place from China’s fifth largest trading partner, and China rose from ASEAN’s sixth largest trading partner to the first. In the rapid development of bilateral trade, the differences of factor endowment are weakening and the scale becomes more important. And in China and ASEAN, the majority products meet a growing demand and have purchasing differences in different countries. Technological changes have been penetrated in all of the industries and all of the countries have continuously enhanced the comparative advantage. With the industrial transferring and industrial structure adjusting, the Industry specialization and trade structure between China and ASEAN have changed. The traditional inter-industry specialization between China and ASEAN has tapered off and intra-industry specialization began to take shape. In the intra-industry trade, manufacturing sector has been playing a very important role.Based on the combination of theoretical and empirical methods, this article tried to analyze the factors affecting the intra-industry trade in manufacturing sector. Firstly, after reviewing the domestic and international research on the factors, it introduced the meaning of intra-industry trade, the formation, the classification and calculation which constitutes the theoretical foundation of this paper. Secondly, based on the 2003-2012 data of manufacturing trade between China and ASEAN, using the Grubel-Lloyd index, the intra-industry trade between China and ASEAN manufacturing index were calculated. According to the statistical results, it is found that China and ASEAN intra-industry trade level showed a downward trend, within the country’s manufacturing industry trade imbalance and internal manufacturing different types of products intra industry trade imbalance. Finally, combined with the factors affecting the level of intra-industry trade in theory, five variables factors were selected to establish a trade gravity model. These five variables are the per capita GDP of China-ASEAN, China-ASEAN differences in per capita GDP, China-ASEAN average differences in market size, China-ASEAN economic integration, ASEAN’s direct investment in China. On the basis of empirical variables, in order to promote further development in China and ASEAN intra-industry trade, a series of policy measures were proposed.