A Study On The Relationship Between Goods Trade And Service Trade Of China

China’s international trade is expanding quickiy since China began to reform and opening up, which have made enormous contribution to national economy development. The status of the tertiary industry in the global economy is becoming increasingly important and service trade starts exceeding goods trade with the fact that scientific and technological revolution and economic globalization paces accelerate. For China, from theoretical and practical aspects, trade in goods performed better than service trade by the effect from international environment and domestic economic policy. Therefore, we should explore the interaction between trade in services and trade in goods. If we can understand the relationship, we can use the relationship to promote the coordinated development of trade in services and trade in goods.This paper first introduces the status quo of China’s service trade, China’s goods trade, the structure of China’s service trade and the structure of China’s goods trade. Then we can get China has a very good development of goods trade and its structure is gradually upgrade, but there is still a gap compared with developed countries. We can also get China’s service trade position is still weak.Secondly, this paper analyzes the impact of the interaction mechanism of trade in goods and trade in services from in two aspects. One from goods trade influence service trade and the other from service trade influence goods trade.Thirdly, I empirical analyzes the relationship between goods trade and service trade. With VAR model checking out in the aggregate have a dynamic interaction between the two trades. Then in this paper I affect the classification to goods trade and service trade individually. The results show goods trade have the greatest impact on the information service, computer service and knowledge service. And trade in goods affect production service trade than consume trade service. Trade in service have the greatest impact on the machinery and transport equipment, chemicals and related products. And trade in goods affect manufactured goods trade than primary goods trade.Finally, the paper put forward a few proposals according to the mechanism analysis. For example, promote the development of trade goods through the development of trade in services. Promote harmonious development between trade in services and trade in goods through FDI.