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Study of China’s Interregional Trade Barrier and Its Influence on Global Competition

Author: WangLei
Tutor: ZhangXiaoDi
School: Zhejiang University
Course: International Trade
Keywords: Interregional trade barrier Global competition Border effect Marketing process Scale economy Institutional competition
CLC: F752
Type: Master's thesis
Year: 2003
Downloads: 304
Quote: 1
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Classic trade theory treats countries as homogeneous and integrative ones, which goes far away from the reality when it predigest the analyze process. Besides, trade as one of the important motives of development of countries, was led to international view point at most of the time, however the domestic situation was neglected. As an important factor which affects the interregional trade and division of work, the interregional trade barrier present what kind of status and what’ s its relation with the global competition and what’ s the mechanism below it? This paper tries to analyze these questions at sub-national level within china.It follows a two step procedure. First, it estimates some province-level indicator of china’ s domestic market fragmentation and global competition mainly on the regions based on the research of Poncet(2002).Zhong (2002) .FanGang( 2003), etc. We find that interregional trade barrier (ITB) is decreasing and eastern is lower than western and middle regions. Besides, interregional trade barrier’ s negative influence on the improvement of regional competition is bigger than the positive influence. For the space of domestic growth, intern regions have good potentialities, coastal regions and Hong Kong-Tai Wan-Macao’ s location advantages have dropped to unimportant position. In the long run, the openness of a region should be suitable to the intern development, outside competition with good intern conditions support is the fundamental insurance for the promote of regional competition.Second, it studies the relation between interregional trade barrier and region’ s global competition from micro and macro economic views respectively, which we call "E-G" model. We find: (1) ITB cumbers the optimization of enterprises’ scale through increase the trade cost; (2) The rate of ITB on inter-industrial products is higher than on theIIintra-industrial aspect, and the product’ s trade barrier has a decreasing situation; (3) From the macro-economics view, the behaviors of governments have grave influences on the integration of domestic market; taxation system and regional law system have great impact on the many aspects which influence the development of economy.At the end of the paper, we try to give some suggestion on the choice of governments’ policies on the dredge mechanism in domestic economy.

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