The Study On The Determinants Of International Competitiveness Of Knowledge-intensive Business Services Trade Between China And India

In recent years,our economy developed rapidly,especially in the aspect of service trade.With the promotion of our economy model to a much more advanced one,the construction of trading is being attracted more and more attention.Nowadays,trading of service is playing a very important role not only in developed countries,but also in developing countries.It is considered to be a new growth point in the next periods.Knowledge and technology are increasingly changing the structure of service trade,and there is a trend that service trade is changing its model from traditional to knowledge-intensive.Knowledge-Intensive Business Services(KIBS)trade is going to be the trend of development in future economy.In the process of globalization,service trade unexpectedly blossoms much faster than trade in goods,especially the KIBS trade which has been the most giant part in the global service trade and it also has been the most important power to the modern economy.China does not pay enough attention to the emphasis of KIBS in national economy,and its own science technology lags behind relatively which made China play a small part in the global trade of KIBS.So,this paper puts KIBS trade as the entry of point to study the international competitiveness of it.The paper introduces the concept of industry international competitiveness as well as the studies on KIBS and theories used in this paper,making the foundations for the analysis.The paper settles the definition and scopes of KIBS in an innovative view.KIBS is an industry of high technology and human capital value added,applying the internet,e-commerce platform to diffuse the new technology.Based on the rules of UNCTAD and WTO,the classification of KIBS includes:Service in Construction,Communication,Service in Insurance,Service in Finance,Service in Computer and Information,Royalties and License Fees,Other Business Services,Service in Personal Cultural and Recreational.KIBS in China is being in the primary stage that its value to the country is not important,and the originality of products with the degree of technology,running,management behinds the common level,so the competitiveness is small relatively.This paper summarizes the recent development trend and international competitiveness KIBS trade,based on data of China and India in recent 16 years.Firstly,based on a lot of data,the paper studies on the KIBS trade about development situation between China and India through the aspects of gross and structure.Secondly,my paper starts to analyze quantitatively the world competitiveness of trade in KIBS between the two of China and India by four statistical indicators:International Market Share,Trade Competitive Power Index,NRCA Index and RCA Index;and it also contrasts China’s world competitiveness of KIBS trade with that of India.In the empirical process,the paper also illuminates the factors influencing international competitiveness of KIBS trade by VAR model and throws out some relevant countermeasures and suggestions.The results show that influential factors for China and India are different.At last,this paper studied the causes that caused the distinctions on the international competitiveness of KIBS trade between the two China and India by means of six sides:human capital,national income per capital,the opening degree of KIBS,development level of trade in service,the exports of trade in goods;and it also proposed several recommendations to facilitate China’s trade competitiveness in Knowledge Intensive Business Services.Therefore we should adopt appropriate measures to boost its KIBS trade according to its actual conditions.Innovation of this paper is that in the empirical analysis part,communication service is new in KIBS,for that communication service was considered to be a part of traditional labor intensive service.Nowadays,the communication is very different from what it used to be,which the difficulty of applying knowledge,technology and human in the process is hard.Because communication service is an emerging industry,its data availability is limited so that there is some deficiencies in this paper.