Employment Effects Of Imports From The Perspective Of Global Value Chain

Export-oriented trade policies have contributed to China’s rapid economic growth,but they have also contributed to China’s long-term imbalance in international payments.Chronic trade surpluses not only exacerbate domestic inflationary pressures,but also increase trade friction between China and deficit countries.Under the traditional macroeconomic framework,a country’s imports are usually regarded as a leakage of national income,which in turn reduces employment through the multiplier effect.Therefore,developed countries often encourage export restriction in the name of protecting employment.But on a global scale,one country’s exports are another’s imports,and no imports,no exports.With the deepening of the division of labor in the global value chain,the production process of products is divided into different countries and regions,and a global production network is built through the trade of intermediate products.In this production network,all the participating countries have formed a community of interests,one prosperity,one loss,and the workers of all countries rely on the product value chain to form a global employment chain.A country’s import of intermediate goods can not only drive the output of downstream industries through domestic industrial linkage,thus expanding the employment of domestic downstream industries,but also directly or indirectly create jobs for workers in all value chain participating countries through global industrial linkage.Because in addition to the value added of the exporting country,the value added of all the countries involved in the production of this product may even include the value added of the export of their upstream intermediates.Thus,the division of labor in the global value chain has changed the relationship between trade and employment in the past,and the effect of import on employment has both negative impact and positive promotion.Based on the background of global value chain(GVC)division of labor,this paper re-examines the impact of Chinese imports on domestic and global employment from the perspective of domestic and international industrial linkages.Through the multi-regional input-output model and the method of hypothesis extraction(HEM),this paper calculates the global employment creation effect of China’s total imports from 2000 to 2014,and takes sino-us trade as an example to estimate the global employment brought by China’s bilateral imports.In addition,combined with the domestic and international dual industrial linkages,this paper explores fourmechanisms of employment impact of China’s import trade,namely direct competition effect,upstream effect,downstream effect and international industrial linkage effect.In addition,the employment effect of China’s imports from the perspective of global value chain(GVC)is examined by the industry panel model.The main conclusions of this paper are as follows :1.From 2000 to 2014,China’s total imports not only created 374,000 jobs for China,but also provided 1.935 million jobs for other countries participating in the division of China’s import value chain.Most of the jobs created are in Asia(India,China,Indonesia,etc.).From an industrial perspective,China’s total imports mainly lead to employment in the world and domestic service industries.2.As far as bilateral imports between China and the United States are concerned,the national structure of employment created by China’s imports from the United States is generally consistent with the national structure of employment created by China’s total imports.3.From the inspection of the mechanism of China’s import affecting employment,it can be seen that the direct competition effect of import trade is significantly negative,the upstream effect is not significantly negative,the downstream effect is significantly positive,and the international industry correlation effect is significantly positive.This shows that China’s import trade,on the one hand,inhibits the employment of domestic related industries due to substitution,but on the other hand,for the downstream industries of imported goods,the import of foreign intermediate goods reduces the production cost,improves the production efficiency,promotes the development of downstream industries and increases the employment in these industries.At the same time,because the imported goods include those produced in the country and then exported to other countries and then imported back to the country,these goods contain the value of the domestic workers,which plays a certain role in stimulating the employment of the country.4.From the perspective of industry heterogeneity,the direct competition effect of the manufacturing industry is negative,the upstream effect and the downstream effect is not significant,and the international industry correlation effect is positive.The direct effect of non-manufacturing industry is negative,the downstream effect is positive,the upstream effect is not significant,and the international industry correlation effect is significantly positive.The conclusion of this paper is conducive to a comprehensive understanding of the impact of Chinese imports on employment from the perspective of global value chain,which not only provides a new theoretical basis for expanding employment,butalso provides practical support for improving international balance of payments,easing trade frictions and building a community with a Shared future for mankind.