Study On The Influence Of FTA To China Manufacturing Industry Value Chain Upgrading

With the development of international vertical specialization, Chinese manufacturing relies on comparative advantage, through investment, production and trade, gradually embedded into the global value chain, and has made great strides to become a "world factory." However, at the same time, on one hand, a number of multinational using the advantage of brands and technology, locked the Chinese manufacturing industries and enterprises in the low-end position, and restricted the competitiveness of China’s manufacturing industry to enhance; On the other hand, global trade protectionism continues to rise, especially the increasing of technical barriers to trade, sanitary and quarantine standards unreasonable restrictions on Chinese exports, has also created a constraint of the interests of Chinese enterprises and industrial development.At present, China is access to the "new normal" transformation process, manufacturing upgrade is critical. This is an important research topic of how to seize the trend of the global technological change and the adjustment of the global rules change, and make the industrial upgrading come true, according to the law of industry development. In this paper, we aiming at the wave of global and development of China, researched the impact of FTA and the opening technology market on China manufacturing upgrading in the global value chain.First, the paper analyzes the influence mechanism of FTA the development country’s manufacturing upgrading in the global value chain. FTA as a foreign trade policy, have effect on country’s international trade, foreign direct investment, the opening of technology market. And international trade, foreign direct investment also affect the technological progress of a country, and thus promote the value chain upgrading. Based on the theoretical analysis, this paper extends the value chain upgrading indicators measurement method of koopman (2010), and use of world input-output database (WIOD), calculate the value chain position of 13 sub-sectors of Chinese manufacturing during 1995-2011. Generally speaking, the higher the degree of China’s participation in global value chains, but a lower position in the global value chain, but there are some differences in industry segments.Further, the paper use Cobb-Douglas function to establish an empirical model, introduced FTA dummy variable, technology markets, international trade, FDI and cross-term of three variables with the FTA, while adding vertical specialization index, R&D investment, manpower capital, physical capital as a control variable, and empirical analysis the impact of the FTA, the technology market openness on Chinese manufacturing value chain upgrading.The empirical results show that, the FTA to promote value chain upgrading, and by the impact of foreign technology FTA market opening, trade imports, FDI to promotes the value chain upgrading of China’s manufacturing industry. For the empirical results, we propose policy recommendations to promote Chinese manufacturing value chain upgrading. Mainly:to deepen the FTA content policy, research and development efforts to attract foreign investment, science involved in the vertical division of labor, and promote the value chain.