The Role of Processing Trade and FDI in China's Economic Growth

DOI

10.2991/icesem-18.2018.160How to use a DOI?

Keywords

Processing trade; FDI; Granger causality test; VAR

Abstract

Based on VAR mode and using Granger causality test approach and variance decomposition, this article examines the role of processing trade and foreign direct investment (FDI) in China's economic growth, and gives an empirical analysis and test of the dynamic correlation between FDI and processing trade. The empirical result shows that the rapid growth of China's economy has attracted a large amount of FDI and promoted the rapid growth of processing trade. There is a long-term equilibrium relationship between FDI and processing, and the variables influence each other through long-run equilibrium relationship. In the short term, FDI and processing trade will not be significantly affected by long-run equilibrium relationship, while economic growth will be significantly affected by long-turn equilibrium relationship.

Copyright

© 2018, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Xijun Wang
PY  - 2018/08
DA  - 2018/08
TI  - The Role of Processing Trade and FDI in China's Economic Growth
BT  - Proceedings of the 2018 2nd International Conference on Education Science and Economic Management (ICESEM 2018)
PB  - Atlantis Press
SP  - 692
EP  - 695
SN  - 2352-5398
UR  - https://doi.org/10.2991/icesem-18.2018.160
DO  - 10.2991/icesem-18.2018.160
ID  - Wang2018/08
ER  -