The Research on Impact of International Trade

on China’s Economic

Aiqin Xu

Zibo Vocational Institute, Zibo China 255314

xuaiqin66@163.com

Abstract. In this paper, according to logarithmic difference sequence of China's

economic growth, import and export, and the establishment of the VAR model
test and the relativity of China international trade and economic growth; From
1984 to 2008, this paper discusses the measures impact effect on economic
growth, the contribution of the import and export of change caused by impulse
response function and variance decomposition (IRF). The results show that in
the first phase, variance decomposition GDP by their own fluctuation, and only
in the second period from the influence of the effect of export is fully reflect
tend to rise, thereafter. After about the sixth period, it gradually becomes stable.
From the influence of the effect of export is reflected in the second half, the
lakers started in the third quarter, in order to reduce to the greatest extent. After
about the sixth period, it gradually becomes stable. The influence from the
import of GDP is relatively weak in the first two times, and then rising. After
about the sixth period, it often is stable.

Keywords: International trade, economic growth, China.

1 Introduction
Since the reform and open policy, our country international trade policy is greatly
increased; At the same time, the interest rates of economic growth to a higher level.
The relationship between international trade and economic growth, therefore, became
the theory hotspots.
On the relationship between international trade and economic growth, most
scholars of empirical studies support export-led growth (ELG) assumption that the
main idea, the proposition to go along two lines, some scholars, use, multinational (or
area) parts (or panel) data, using the correlation coefficient or ordinary least squares
(OLS) test ELG assumptions, some scholars use a single country time series data
validation ELG hypothesis.
Balassal (1978), use the relevant (RC), using the data of the rand 11 industrialized
countries from 1960 to 1966, from 1966 to 1973, testing and analyses the actual
average growth of the relationship between real gross domestic product (GDP)
average growth of exports, and draw the conclusion, export played a positive role in
promoting economic growth [1]. Feder (1982), using the average percentage of OLS
method together with such variables as investment to GDP average growth of
population, the proportion of GDP, and make an analysis of the relationship between

D. Zeng (Ed.): Advances in Computer Science and Engineering, AISC 141, pp. 553–560.
Springerlink.com © Springer-Verlag Berlin Heidelberg 2012
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foreign capital occupies actual GDP average growth and export average rate of GDP
in an overall production function, and support ELG hypothesis [2]. Dollars (1992)
using OLS method, this paper analyzes the 92 countries panel data from 1976 to 1985
[3], McNab and Moore (1998) using OLS method, this paper analyzes the level 3 data
41 developing countries from 1963 to 1973, from 1973 to 1985, two conclude:
exports to stimulate growth [4].
Jung and Marshall (1985) to analyze the relationship between and real gross
domestic product growth (GNP), and the growth of exports and developing countries
and the area from 1950 to 1981 use granger causality test model, but found VARD
five 37 countries and regions support ELG assumptions and 11 this phenomenon's
export-oriented economic growth. Israel has bilateral granger causality, while in the
other 20 DuoGe country does not exist granger causality exports and economic
growth [5]. Karunaratne (1994), based on time series data, validation ELG Australia.
He found the granger test method is to use double varieties of support, and IRFs ELG
test methods and FEVDs using 6 variables no causality (or weak granger causality)
[6].
Chinese scholars research mainly focus on the problems related to the test time
series data of our country. LiWen (1997), the paper makes an empirical analysis using
economic growth model, and finds that the export sector productivity is higher than
the total factor productivity the export department conclusion, thus drawings export
growth driver of China's economic growth [7]. Jiaqin Chen (1999), it can be found
that the export to stimulate growth [8]. Peng Fuwei (1999) can be found, foreign trade
on economic growth needs little effect [9]. ZhaoJinLing Shaohua, song song and
Hongming (2001) for granger causality test in 3 variables error correction model
using annual data from 1978 to 1999 and the relationship between the quantitative
analysis and real GDP exports actually, but found that China's export growth on the
economic growth of the driving effect will last a short-term, a very long period of
time, it is not obvious [10]. Xu Qifa, jiang zemin Cuixia analysis (2002) said that,
while there are the intense correlation international trade and economic growth, not
simple the import or export of lead to economic growth, and export total volume of
the cause of the economic growth is very [11].
Go to the above-mentioned documents, I found that most scholars focused on
exports and economic growth of the research on the relationship between the impact
on the economy of imports is very small. Consider factors in the process of building
model are single, even ignoring some important variables. On this basis, this paper
aims to select import and export to illustrate influence the rapid development of
China's economy.

2 Model and Analyzing Method

This paper goes as follows:
Firstly, the paper has the stationary test of China’s economic growth, import and
export by employing unit root test techniques.
Time series of many economic indicators do not have the feature of stable process.
For the time series formed in non-stationary process, traditional mathematical
statistics and econometrics methods seem powerless. Besides using sequential