Analysis Of The Induction And Dependence Relationship Between Demand And Output Of China And Korea And Japanese Under The Background Of The East Asian Production Network

With the further development of the production network in East Asia, the establishment of the FTA among Korea, China and Japan has become the focus of the Northeast Asia Regional Economic Cooperation. From November 2012 to 2014, FTA among Korea, China and Japan had been five rounds of negotiations, in January 16, 2015, the sixth round of FTA chief talk was held in Tokyo, Japan, with the issue of fall tax plan of cargo trade, service trade and the method of opening investment.etc.Based on the current development of production network East Asia, using the WIOD database, this paper analysis the demand structure of economies in the production network in East Asia, Construct a output requirement coefficient induced by final demand based on international regional input-output model, and compare comprehensively and analysis the dynamic characteristics of induced effect of final demand and its influencing factors of China, Japan and South Korea in 1995- 2011.The results showed that: Firstly, on the whole, imported intermediate demand in the countries of the East Asia accounted for intermediate demand is greater than the proportion of imported final demand accounted for the final demand. This shows that intermediate goods trade is becoming more and more important in a country's business, and vertical specialization model is an important Division mode of East Asia. Secondly, China is playing an increasingly important role in the East Asian production network, as the largest supplier of final and intermediate products for East Asian countries. The position of the United States, Japan and the EU has been gradually weakened. Especially to South Korea and Japan, China is the largest origin country of imported intermediate and final demand of Japan and South Korea. Finally, the final demand's directly output induced coefficient of China, Japan and South Korea has no difference, but there is a big difference in indirectly induced coefficient, while the trade scale of intermediate goods is closely related with the size of indirectly induced coefficient. After decomposing indirectly induced coefficients, we found that:under the background of East Asian production network, the indirectly induced coefficient of Korea by China is greater through the consumption of final product of other East Asian countries, while the indirectly induced coefficient of China by South Korea through the consumption of final goods of other countries in East Asia can not be overlooked. Analyzing the trade in China and Japan, we found that the indirectly induced coefficient of Japan by China is the biggest through the consumption of final product of other East Asian countries, while the indirectly induced coefficient of South Korea by Japan is the biggest through the consumption of final goods of China. Analyzing the trade in South Korea and Japan, we found that the indirectly induced coefficient of South Korea by Japan is the biggest through the consumption of final product of China, while the biggest indirectly induced coefficient of Japan by South Korea is through the consumption of final goods of other East Asian countries. Throughout the East Asian production network, If China, Japan and South Korea reached a free trade agreement will not only have a direct effect of trade policy, on the other hand it will lead to the reconstruction of the entire East Asian production network, forming an indirectly affect on trade flows and the hidden supply changes. All these are beneficial to the economic development of the three countries.