Summary: the relationship between domestic regional trade and international trade in big countries is mainly manifested in two aspects: first, domestic regional trade and international trade have a certain degree of mutual substitution; Second, domestic regional trade and international trade promote each other, and developing domestic regional trade can enhance the competitiveness of big countries in the international economy.
Key words: regional trade, international trade, comparative advantage, economies of scale, division of labor and specialization, national competitiveness
Throughout the history of world industrialization, domestic regional trade and international trade have played a significant role in promoting domestic industrialization, but for big countries, it seems that the role of domestic regional trade is more obvious than that of small countries. According to Chenery's research. H et al. pointed out that in the process of industrialization in big countries, the average contribution rate of domestic trade expansion to light industry growth is about 80%, and the contribution rate to heavy industry is about 65%, while that in small countries is 60% and 40% respectively. In short, in the economies of big countries, the final contribution rate of domestic trade to light industry and heavy industry is greater than that of small countries. According to Kuznets' research, for a big country, if the domestic regional trade is developed, it can also achieve economic growth that is not dependent on international trade, because the domestic market and resource conditions of a big country allow it to develop specialization and economies of scale. It doesn't mean that China doesn't need international trade, nor does it mean that China doesn't need to continue to expand its foreign trade. It reminds us that while developing international trade, we should not ignore the irreplaceable role of domestic regional trade in economic development and enhancing national competitiveness. Since the reform and opening up, various regions in China have actively developed foreign trade under the circumstances that there are a large number of trade barriers and domestic regional trade accounts for a small proportion of the total GDP. Moreover, the enthusiasm of various regions for international trade is far greater than that for domestic trade, and foreign trade preferences have been formed to varying degrees. This trade pattern has a great impact on China's economic development, which makes it difficult for China, as a big country, to give full play to its national comparative advantages, economies of scale, economies of division of labor and specialized economies. Under the background of economic globalization and China's commitment to join the WTO year by year, it is urgent to explore how to coordinate the relationship between domestic regional trade and international trade.
1, the mutual substitution relationship between regional trade and international trade
It is generally believed that international trade and regional trade have the same trade basis. The research of trade theory so far shows that comparative advantage is still the main basis of trade. Among the various sources of comparative advantage, the most common one is the difference of factor endowment. Let's take factor endowment as an example to discuss the mutual substitution relationship between regional trade and foreign trade.
Suppose a country has two regions, E and W, producing two products, X (labor-intensive) and Y (capital-intensive), and using two elements, K (labor). There is no transnational flow of production factors, and K does not flow across regions. Moreover, regional and international trade is based on the difference of relative factor endowments, and products produced by using relatively rich factors in regions or countries have competitive advantages. Suppose that at the beginning, the relative factor endowments of E and W are the same as those of the world. There is neither regional trade nor foreign trade, and the production and consumption of country A are equal. The labor force flows from W to E, and the capital does not flow, which leads to the difference of regional and international relative factor endowments. The substitution relationship between regional trade and international trade is discussed in several cases.
1. 1 Regional trade and international trade under incomplete division of labor
Obviously, the inflow of labor force makes E region become a region with relatively abundant labor force, producing more X, while W region produces more Y. According to Robertzinski's theorem, X's increase in E's output will be equal to X's decrease in W's output, and Y's decrease in E's output will be equal to Y's increase in W's output ... In other words, on the whole, the production of country A is still equal to consumption. Due to the deviation between production and demand in these two regions; Trade is inevitable, e will output x, and input y and w will be the opposite; As for whether this kind of import and export takes the form of regional trade or trade, or both, it is difficult to determine. Because according to the hypothesis, at this time, the price of foreign trade and regional trade is the same, and the transaction cost is the same, and there is no difference between them. More generally, two kinds of trade coexist. At this time, it can be determined that: first, foreign trade is strictly cross-trade, and the foreign trade forms of E and W are opposite, and the trade volume is equal, so that country A as a whole imports and exports X and Y at the same time, and the import and export amounts of X and Y are equal; Second, because the total trade volume is fixed, the increase of regional trade volume will reduce the foreign trade volume, and the increase of foreign trade volume will reduce the regional trade volume. There is an obvious substitution relationship between the two kinds of trade.
1.2 regional trade and international trade when regional division of labor is completed
It is still assumed that the labor force flows from W to E, and the quantity is large enough to make W continue to flow after completing the division of labor in Y. In this case, the W area will not only reduce the output of X, but also reduce the output of Y, while the E area will only increase the output of X; In order to maintain the relative quantity of X and Y in the original consumption, country A must become a net importer of Y and a net exporter of X ... This is the same as the previous forms of regional trade and international trade in E region. The regional trade volume and foreign trade volume of the two regions can be combined in many ways to achieve the above results: first, E and W have regional trade and foreign trade at the same time, E exports X imports Y, W on the contrary, E's foreign trade volume exceeds W, thus ensuring that A is a net exporter of X and a net importer of Y; Second, part of the trade between E and W is foreign trade, but the foreign trade volume of E exceeds that of W, thus maintaining the trade form of country A as a whole; Third, the trade of W is all regional trade, the trade of E includes regional trade and foreign trade, and the trade form of E is the whole trade form of country A.. The first situation is the most common, at this time, the substitution relationship between regional trade and foreign trade is more prominent, and the increase of one trade will reduce the other trade. When the labor force continues to move from W to E, resulting in the complete division of labor of X, the result is the same as the above two situations, and the substitution relationship between regional trade and foreign trade still exists. Just because the distribution of labor factors is more uneven, country A as a whole; Y's output is lower and its consumption level is lower.
The above analysis of the substitution relationship between regional trade and foreign trade in the case that capital does not flow across regions and labor force is unevenly distributed in different regions. In the case of uniform distribution of labor and uneven distribution of capital, this substitution relationship also exists, but the forms of regional trade and foreign trade will change accordingly; I won't go into details here.
On the premise of maintaining trade balance, the regional trade volume of the two regions is the same, and the region with large trade volume is also a region with large foreign trade volume, and the trade form of this region determines the foreign trade form of country A. That is to say, after being divided into two regions, country A participates in international division of labor and trade in the form of regions, and the overall foreign division of labor and trade form of country A is the sum of its regional foreign division of labor and trade forms; As long as the forms of foreign trade in different regions are different, there is the possibility of mutual substitution between regional trade and foreign trade.
1.3 factors affecting the distribution of trade volume between regional trade and foreign trade
In the case of certain trade volume and trade form in various regions, many factors can affect the distribution of trade volume between regional trade and foreign trade. In the natural state without policy intervention, this distribution mainly depends on the terms of trade and transaction costs of these two kinds of trade. In the case of the same transaction cost, for the exporter, if the terms of trade of regional trade are better than foreign trade, it will try to transform foreign trade into regional trade until the terms of trade are the same or the foreign trade volume drops to zero; If foreign trade conditions are better, the opposite is true. Under the same trade conditions, if the transaction cost of foreign trade is high, foreign trade will be transformed into regional trade, and if the transaction cost of regional trade is high, the opposite is true. Because the transaction cost of foreign trade is higher than that of regional trade in natural state, regional trade has developed greatly before foreign trade in the process of industrialization in many developed countries.
2. Mutual promotion of regional trade and international trade.
2. 1 International trade promotes the development of domestic regional trade
Braudel made a detailed historical investigation on the formation of national markets in European nation-states in the late Middle Ages and early modern times, and came to the conclusion that the prosperity of foreign trade is usually the prelude to the final birth of a unified national market ... The development from a regional market to a national market does not spontaneously connect several small, almost independent and often quite individualized economic zones, but a unified domestic market is not only completed under the compulsion of political will, but also under the compulsion of capitalist commercial expansion, especially long-distance foreign trade.
2.2 The economies of scale promoted by the expansion of regional trade volume can change the international competitive advantage of products.
With the increase of domestic regional trade volume, the production scale of domestic enterprises increases, and the economies of scale of enterprises reduce the average cost of unit output, which provides a basis for improving price competitiveness. After the price competitiveness is improved, other conditions, especially non-price competitiveness, will not only increase the difficulty for other countries' products to enter the domestic market, but also make a country likely to become an export product even if it is difficult to compete with other countries' products in the domestic market, thus gaining new international competitive advantages and changing the international distribution of competitive advantages. As shown in figure 1, AC is the average cost curve of a product. Assuming that domestic and foreign enterprises adopt the principle of cost pricing, before obtaining economies of scale, the domestic product price of country A is P 1, while the product price of country W is P0, p1>; P0, when the transaction cost of country W entering its market is lower than (P 1-P0), country A will still import the product; When country A achieved economies of scale at t 1 through regional trade, its price dropped to P2 P2.
2.3 The external economy of the industry strengthens the continuous competitive advantage of products and prevents potential competitors from entering the market.
Suppose that a big country has no factor endowment advantage in producing I products, but a small country J has factor endowment advantage in producing I products. As shown in Figure 2, WI represents the demand of world I products. Both A and J can be produced, and AC is the average cost curve of product I in country A; ACˊ is the average cost curve of products in country J, and the downward inclination of the two average cost curves indicates that there is an external economy in this industry. The fact that ACˊ is below AC means that the production cost of country J is low at every output level. According to the theory of factor endowment, country J should produce I products and export them. Due to historical reasons, country a first produced I. Due to the developed domestic regional trade and the huge demand for this product, under the influence of internal and external economies of scale, country A has continuously reduced its cost and exported it to the world market. Finally, it provides Q product I (P1= AC 1) at the price of P and the average cost of AC1,which is the equilibrium point of the world market. If country J produces and exports product I, it can be sold to P2 (P2
2.4 The division of labor and specialized economy promoted by regional trade have enhanced the competitiveness of products in the international market.
Smith's theorem tells us that the division of labor is limited by the scope of the market. After the occurrence of regional trade, enterprises are faced with the nationwide market, thus having the necessary premise for the development of division of labor and realizing the "plus C" economy and specialized economy. Division of labor and specialized economy refers to the economic phenomenon that when a product is specially produced, its marginal or average labor productivity increases with the improvement of the specialization level of this production activity. From the perspective of cost, specialized economy shows that within a certain range, the average cost decreases with the improvement of specialization level.
Suppose an enterprise can engage in two kinds of production activities to produce products X and Y. The labor share of the enterprise in the production activities of product I is the specialization level of enterprise production I, and L stands for this level. Its production function can be assumed as follows:
XP and yP represent the output of the two products respectively, X and Y are their self-sufficiency rate, xs and ys are their sales volume, and A is the parameter of specialized economic degree. For this enterprise:
Lx Ly= 1 (3)
That is, the total labor share is 1. If an enterprise has a unit of labor, Li is also used to produce products. The derivation of ① and ② is not difficult to verify.
Among them, dxp/dlx and dyPdLy are the marginal labor productivity of the two products respectively. Equations (4) and (5) show that the marginal labor productivity dxp/dlx and dyp/dly increase with the increase of specialization level Li, that is, the second derivative of output level to labor input level is greater than 0. It can be seen from similar calculations that the average labor productivity also increases with the improvement of specialization level. Let the average labor productivity be
Therefore, when an enterprise produces a product, the production function shows that the marginal or average labor productivity increases with the improvement of the specialization level of the enterprise in this activity.
In addition, the market of enterprises expands with the expansion of regional trade, and the possibility of enterprise specialization is increasing. In the production function, if all the input levels increase in equal proportion, we can see that the output increases in a larger proportion. In the formula (1), if Lx is increased to 2L, there is a new XP = lxa = (2lx) a = 2alxa (a >; 1), it is obvious that the new xP is larger than the original 2x a, and the proportion of output increase is greater than the proportion of input increase, which is similar to the phenomenon of increasing returns in economies of scale, but this increase in returns is caused by the improvement of professional level Li. It can be seen that the remuneration increases with the improvement of enterprise specialization level. Increasing remuneration will strengthen the competitive advantage of this country's products in the international market and obviously promote international trade.
3. Case study on the relationship between domestic regional trade, international trade and national competitiveness.
The United States was founded on the basis of North America 13 colonies. For a long time before and after the founding of the People's Republic of China, the trade links between various regions and Europe and the Caribbean were frequent, the economic and trade links between countries were very weak, and the domestic interregional trade was extremely underdeveloped. In the early days of the People's Republic of China, domestic interregional trade obviously lagged behind international trade, and regional foreign trade was obviously superior to domestic trade.
/kloc-At the beginning of the 9th century, the domestic regional trade in the United States has made rapid development. Linstrom Diane's research shows that in the first stage of American industrialization (1800- 1865), the inter-regional trade in the United States has sprung up suddenly, and the relationship between domestic regional trade and international trade is quite obvious.
3. 1 Regional trade partially replaces international trade
Take Philadelphia in the east as an example. During the 22 years from 18 16 to 1837, the total import and export volume decreased from 72% to 22%, and the export volume decreased from 36% to 15%. Accordingly, the import and export to other parts of China have increased rapidly, and the proportion of domestic interregional trade has risen rapidly, and the trend of regional trade replacing international trade is very obvious. The trend of regional trade replacing international trade is increasing, which strengthens the economic ties between countries, reduces the dependence of the United States on foreign trade, enhances economic independence, and lays a solid economic foundation for the political independence of the United States at that time.
3.2 The economies of scale promoted by regional trade have spawned a large number of large-scale and competitive enterprises.
Because the industrialization process of the United States is accompanied by the expansion of the western territory, the westward migration of population and large-scale development, driven by regional free trade and the rapid establishment of inter-regional (interstate) transportation networks, the market scale faced by enterprises is constantly increasing, realizing the economies of scale of enterprises, which is particularly obvious in the steel, petrochemical, power generation and automobile manufacturing industries. Until now, there are still a number of enterprises in these industries that are highly competitive internationally.
3.3 Regional Trade Promotion Specialized Industrial Zone
With the expansion of market scope, regional specialized division of labor is rapidly formed, and regional specialized industrial zones are formed on the basis of their respective comparative advantages, and related supporting industries are rapidly generated on the basis of specialized division of labor, realizing external economies of scale and rapidly improving industrial competitiveness. The development of regional trade in the United States has expanded the market scope faced by enterprises and promoted the division of labor and specialization in the United States. This also proves Smith's view that the division of labor is limited by the market scope to some extent.
3.4 Regional trade promotes the competitiveness of the domestic market.
Because in the case of regional free trade, the regional market in the United States is integrated into a whole, which makes local enterprises face the national market instead of the regional market, and the number of enterprises competing in the local market increases, thus eliminating the monopoly of local enterprises on the local market and maintaining the competitiveness of the domestic market, enabling suppliers to establish comparative advantages in product categories with relatively large domestic demand and strong dynamic effects of competition and imitation among sellers, while domestic competition and imitation also provide rich soil for domestic suppliers to stimulate innovation.
The scale economy, division of labor and specialization, as well as the unified competitive market in China, which are born from the development of domestic regional trade, play an important role in improving the international competitiveness of enterprises and industries and lay a solid foundation for the United States to dominate the international economy.
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