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Liu Ruixiang: Report on China’s Economic Globalization
Release time: 2019-12-14   Author: Liu Ruixiang

Since  the second half of the last century, the development of information  technology and reduction of transportation costs have led to huge changes to  the international labor division and continuous extension of the production  process. Besides, the products have been redistributed globally according to  the resources endowment and comparative advantages of different countries and  regions, which has brought enormous changes to the economic and social  development of all countries around the world. In the globalization process,  the total import and export trade volumes of different countries are growing  faster than GDP growth, among which the proportion of the intermediate input  trade volume is also increasing. Vertical specialization has gradually become  a new method for human to organize production activities. Thomas L. Friedman  pointed out in his book, The World Is Flat, that the economic globalization which is driven by information  technology revolution, trade liberalization and production outsourcing will  bring broad prospects of productivity improvement, poverty reduction and  wealth increasing to human society. However, with the high praises for  globalization, a new trend of “De-globalization” marked by “Brexit” and  “Trump’s New Policies” has risen overnight, which, together with the widely  prevailing trade protectionism of developed countries, brings uncertainty to the  future of globalization. What globalization has brought to China’s economy?  What is the future of globalization? How should China react to the  uncertainties of globalization? The answers to the above questions are of  great significance to China’s economic development.
   
   Based on the data of the World Input-Output Database (WIOD) from 2000 to  2014, the report analyzed the impact of globalization on China’s economy with  the following aspects: (1) measuring China’s participation in GVC by constructing  the vertical specification index, GVC engagement index and international  labor division index; (2) measuring China’s position and status in the GVC  specialization by constructing the upstream and downstream index and GVC  status index; (3) Establishing Revealed Comparative Advantage Index and  analyzing the international competitiveness of China’s industrial sectors  from the perspective of traditional trade and intermediate products trade;  (4) analyzing the changes in the sensitivity and influence of Chinese  economy’s to other countries by constructing the sensitivity and influence  index from the perspective of economic spatial correlation; (5) the impact of  globalization on China’s economic growth; (6) the relationship between  globalization and transformation of China’s industrial structure; (7)  analyzing the trend of global economic pattern and performance of China’s  economic growth in the globalization process ; (8) proposing policy  suggestions on China’s actions in the next round of globalization based on  the research conclusions of the “de-globalization” phenomenon and the  prospect of globalization.
   
   (Author(s): Liu Ruixiang, Yan Yingen and Dai Feng, Research Group of  Yangtze IDEI, Nanjing University)