The Effect of the Trade Costs on Determining the Export Industrial Immigration in China:Based on the Heterogeneous Firms Trade ModelChinese Full Text
Liu Qing,Zheng Jichao(1.Hefei University of Technology,Hefei 230009,China; 2.Anhui Academy of Social Sciences,Hefei 230053,China)
Abstract: It is of vital importance to guide the export industrial immigration rationally in China.Based on the existing Heterogeneous Firms Trade（HFT） literature,we propose a Melitz-style trade model where heterogeneous firms sort into three main groups by self-selection effect.Based on the model,we show that firms with different efficiency would like to choose different trade modes and production location.Using the Chinese manufacturing firm-level data,we provide evidence consistent with this prediction.In addition,our model implies an important trade and investment policy.That is,the variable trade costs and the fixed trade costs for the location-transferring firms have a different effect on the location choice of these heterogeneous firms.Therefore,the government should pay more attention to improve the business environment and incentive system instead of the temporary preferential policies on tax.
- DOI：
10.13269/j.cnki.ier.2013.01.006
- Series：
- Subject：
- Classification Code：
F752.62;F224
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