Research On The Influence Of Diplomatic Relations On The Scale Of China’s Foreign Trade In Goods

With the deepening of globalization,international political relations and economic ties are deepening.Politics serves economy.Behind the use of political power,there are economic considerations.A good bilateral diplomatic relationship is an important condition for the stable and sustainable development of international trade between the two countries.As the most important form of national political and diplomatic activities,leaders’ visits play a special role in China’s bilateral trade in goods.This paper focuses on the visit of state leaders to study the influence of foreign relations on China’s bilateral trade in goods.Through trust mechanism,friction resolution mechanism and cultural mechanism,leaders’ visits effectively affect the total cost of bilateral transactions,including trade barriers,cultural differences,information search cost and trade friction cost,thus affecting international trade.In this paper,the extended trade gravity model is established to prove the influence of foreign relations on trade theoretically.The empirical aspect,on the basis of combing the literature puts forward hypothesis,choose goods trade and diplomatic ties with China in 165 countries of the relationship between 2002 ~ 2017,a total of 16 years of data,application of effective examines the expanded trade gravity model in 2001 after China’s accession to the world trade organization(WTO)diplomatic relations will be measured by the top leaders to visit the extent to which affect trade between the two countries.The following conclusions can be drawn: first,good high-level visits can effectively promote bilateral trade.After adding transaction costs,the results prove that there is an intermediate mechanism of transaction costs in the current impact of high-level visits,and foreign leaders’ visits have a significant positive effect on China’s foreign trade.Second,high-level visits have a significantly different impact on China’s product-level trade,and different impacts on import and export.Thirdly,from the perspective of the impact duration of the visit,the impact of the visit on China’s foreign trade is greater than that of the visit,which lasts for nearly three years and lasts for about two years.In the context of the major changes in the international landscape and the complicated international political environment,China is faced with various risks and uncertainties in its foreign trade.This requires the government to actively play its role,use the political influence of national leaders,to create a good external environment for foreign trade.At the end of the article,the author puts forward relevant policies and Suggestions from the aspect of leaders’ visit.The empirical results of this paper have certain significance for theoretical analysis and practical guidance in the future.