First of all, immiserizing growth's related theories and domestic research status.
Immiserizing growth was first proposed by Brevish and Singh, and later Indian economist bhagwati linked the terms of trade with economic growth. Its basic meaning is that the economic growth of a big country leads to a serious deterioration of the terms of trade, so that the decline of social welfare is much higher than the improvement of social welfare caused by the increase of per capita output, and eventually there will be an increase in poverty, so it is also called "tragic growth".
In 199 1, Peter Lindert summed up three preconditions of immiserizing growth in international economics, and Wang Ruzhong (1999), a domestic scholar, added another precondition: first, the country must be a big trading country, because only the changes in the import and export volume of big trading countries will affect the world commodity prices; Second, this country must rely heavily on international trade. Therefore, the decline in terms of trade is of great significance to welfare, which is enough to offset the benefits of supplying more goods; Third, foreign demand for domestic exports must be price-inelastic. Therefore, the expansion of export supply will lead to a sharp drop in prices; Fourth, the growth of the national economy must be biased towards exports.
The most important basis for judging whether a country is immiserizing growth is the terms of trade. Terms of trade, also known as trade parity or exchange parity, refers to the ratio of imported goods (price, purchasing power and factors) that a country can exchange with one unit of goods (price, purchasing power and factors) in foreign trade. Terms of trade is a relative concept to some extent. The terms of trade can reflect the changing trend of the country's price advantage and competitiveness. There are four terms of trade commonly used in practice: price terms of trade, income terms of trade, single-factor terms of trade and double-factor terms of trade.
In recent years, there has been a consensus on whether China's terms of trade are deteriorating. Many domestic scholars have studied China's terms of trade and immiserizing growth from different angles. The International Market Research Office of the Ministry of Commerce (200 1) has published the only data that may be an official systematic study of China's terms of trade, and thinks that 1993-2000. Based on 1995, China's overall terms of trade index decreased by13%; Wu Liang (200 1) analyzed the types of terms of trade and their influence on trade interests. It is pointed out that the change of a country's trade situation should be analyzed in combination with income terms of trade and factor terms of trade. Gong Jiayou and Qian Xuefeng (2003) believe that China's economy is facing the danger of immiserizing growth, and China must choose an export-oriented development strategy based on competitive advantage; Niu (2004) mentioned in Trend Analysis of Labor-intensive Products and Terms of Trade that the rapid expansion of labor-intensive products will inevitably lead to the deterioration of China's terms of trade due to its internal reasons. After China's entry into WTO, the deterioration of terms of trade will inevitably lead to the increase of poverty. Lin Lin and Zhou Jue (2005) studied the relationship between the expansion of labor-intensive products and the deterioration of terms of trade in China's export trade by analyzing the data of 1994-2002. Lin li et al. (2005) made an empirical study on China's terms of trade from 65438 to 0994 to 2002, and came to the conclusion that China's price terms of trade deteriorated obviously during this period, but its income terms of trade showed an improvement trend. Chen Feixiang and others (2005) think that the change of income terms of trade index should be considered reasonably when analyzing terms of trade. Through empirical analysis, it is concluded that China's income terms of trade index shows a continuous improvement trend, and it is considered that the conclusion that China's terms of trade have deteriorated seriously only based on the decline of price terms of trade index lacks sufficient basis.
Second, look at the tendency of China and immiserizing growth from the premise.
(1) China is a big trading country.
Over the past 20 years of reform and opening-up, China's economic ties with the rest of the world have become increasingly close, its economic strength has been significantly enhanced, and its international influence has been increasing day by day. From 65438 to 0978 to 2005, China's GDP grew at an average annual rate of 9.4%, ranking seventh in the world in 2005. At present, China has become the largest producer of vegetables, steel, fertilizers, coal and other products, and the largest consumer of grain, meat, coal and steel. At the same time, as shown in the figure 1, from 1978 to 2004, China's foreign trade increased at an average annual rate of 16.7%. In 2005, the total trade volume was close to 1.5 trillion US dollars, which was 56 times higher than 1.978, and rose from 27th place to 3rd place in the world. Foreign trade directly provided more than 80 million jobs. In 2005, foreign exchange reserves exceeded US$ 800 billion, ranking second in the world. Since China joined the WTO, the trade growth has exceeded 30% for three consecutive years.
There is no doubt that China is a big trading country, which meets one of the prerequisites of immiserizing growth.
(B) China's dependence on international trade.
Generally speaking, the size of a country largely determines a country's dependence on foreign trade; The dependence of big countries on foreign trade is relatively low, while that of small countries is relatively high. But surprisingly, China, as a big country. The economy is increasingly dependent on the growth of foreign trade. Since 1980s, the growth rate of China's foreign trade has been higher than the growth rate of gross national product, which is directly reflected in the increase of foreign trade dependence. With 200 1 China formally joining the WTO, the scale of trade has been further expanded, and the dependence on foreign trade has also risen sharply. In 2004, the foreign trade dependence of China's GDP was as high as 70%, which shows that China's economy is highly dependent on the international market.
As can be seen from Figure 2, China's dependence on foreign trade is much higher than that of other countries. According to statistics, from 1995 to 2004, the foreign trade dependence of the United States and Japan was generally stable in the range of 14%-20%, and that of India was generally stable in the range of 20%-40%. It was not until 2004 that it exceeded 40%: in the same period, China's total foreign trade reached a new high, and its dependence on foreign trade rose again and again, far higher than the above-mentioned developed and developing countries. In 2004, for example, China's dependence on foreign trade was as high as 69.8%, much higher than that of the United States and Japan (19.99% and 23.37%), and even nearly twice that of developing country India. Therefore, it can be concluded that this situation in China accords with immiserizing growth's second premise.
(C) the price elasticity of foreign demand for China's export products
At present, the export reality of most small and medium-sized enterprises in China is that labor-intensive products are the main export products, such as food, textiles and other primary products and manufactured goods. This export commodity structure will not change for a period of time due to its own conditions and international environment. These products are characterized by fierce competition, low elasticity of demand and price, and low entry threshold, which easily leads to oversupply and disorderly competition. Developing countries in East Asia, South Asia and Latin China, represented by textiles, are all strong competitors or potential competitors of textiles. Under the pressure of domestic product substitution, the rapid expansion of China's exports will inevitably lead to the decline of export prices. The increasingly fierce textile trade disputes and anti-dumping investigations in recent years also show from another angle that some of China's export commodities have already faced the situation that the export price needs to be greatly reduced to increase the export quantity, that is, the deterioration of price terms of trade meets the third condition of immiserizing growth.
(D) China's export-oriented national economic growth
According to the theory of international economics, increasing exports, domestic investment and government expenditure has a very important pulling effect on economic development. People vividly call it the "troika" that drives the economic development of a country or region.
China implemented import substitution policy before 1990, and export-oriented policy after 1990. The latter strategy is influenced by mercantilism, which emphasizes exports over imports. By expanding the export of manufactured goods, China has promoted economic development and realized industrialization, and the state has taken various measures to expand exports. This shows that China's GDP growth rate remained around 8% in the 1990s, while the export growth rate in other years exceeded the GDP growth rate except 1.996 and 1.998 (see table 1), which is self-evident and meets the fourth prerequisite of immiserizing growth.
Table 1: Comparison of China's national economic growth rate and export growth rate (unit:%)
Year19951996199719981999 2000 2006 5438+0 2002 2003 2004.
The GDP growth rate is 5.67 6.08 5.615.04 5.33 7.74 7.24 8.23 9.591.1.55.
The export growth rate is 2.04-6.7317.2610.23 7.66 27.19 6.00 23.35 33.05 30.22.
Source: According to China Statistical Yearbook 2005.
Table 2: Three terms of trade indices (based on 1995)
Annual export price index import price index price terms of trade index export quantity index income terms of trade index labor productivity index single factor terms of trade index.
1995 100 100 100 100 100 1.00 100
1996 100 97 103 95 97 1.08 1 12
1997 100 95 106 1 15 12 1 1. 17 124
1998 94 96 98 1 13 1 1 1 1.27 125
1999 89 92 97 126 122 1.39 134
2000 90 100 90 156 140 1.54 138
200 1 89 96 93 155 144 1.66 154
2002 86 95 90 182 165 1.88 170
2003 92 108 86 222 19 1 2.08 179
2004 1 12 132 84 248 209 2.20 186
Source: Calculated according to the data of China Statistical Yearbook and China Foreign Economic Statistical Yearbook 1996-2005.
Third, look at the trend of China and immiserizing growth from the terms of trade.
(A) price, income, single-factor terms of trade index analysis
As it is difficult to obtain the terms of trade index directly during the writing of this article, according to the list of import and export commodities listed in China Foreign Economic Statistics Yearbook, we select 142 main export commodities and 66 main import commodities to calculate China's foreign trade terms by ourselves.
Prices and terms of trade are determined by import and export price indices. As can be seen from Table 2, China's import price index has fluctuated from time to time since the mid-1990s, but there is no obvious change trend. In the same period, the export price index has been declining by about 65,438+00%. As a result, the price terms of trade index continued to tilt to the lower right, showing a deteriorating trend, with an overall decline of 20%. Among them, the terms of trade of 1995- 1997 increased slightly, which was due to the fact that the export price index remained basically unchanged during this period, while the import price index continued to decline; In 2004, the import and export price index increased by leaps and bounds, which may be caused by the sharp increase in world prices of a large number of resource products imported by China and a large number of primary products exported.
The income terms of trade index is determined by the price terms of trade index and the export quantity index. Since the export quantity index has not changed significantly during the period of 1995- 1997, the curves of income terms of trade and price terms of trade basically coincide during this period: since 1998, due to the increasing export quantity, the curves of income terms of trade and price terms of trade have deviated from each other. Although the price terms of trade are still deteriorating, the export volume has increased significantly, which has significantly improved the income terms of trade.
The single factor terms of trade are determined by the price terms of trade index of export commodities and labor productivity. According to the types of import and export products, the terms of trade include the terms of trade of primary products and the terms of trade of finished products. With the development of China's foreign trade, the proportion of manufactured goods is increasing, so China's overall terms of trade more reflect the characteristics of the terms of trade of manufactured goods. Therefore, this paper uses the labor productivity of the secondary industry to replace the labor productivity of exporting domestic goods and importing foreign goods. Due to the rapid development of China's productivity in recent years, the labor productivity has obviously improved. From 1995 to 2004, labor productivity increased by 120%, far exceeding the decline of price terms of trade, which made the terms of trade of single factor continue to rise. Since 1998, the terms of single factor trade have improved significantly, with an increase of 86% in ten years.
From the analysis of the above data, it can be found that the terms of trade of price and income in China have risen and fallen in recent years, which can not well judge the current situation of China's terms of trade. Because the increase of labor productivity is higher than the decrease of price, the terms of single factor trade are improved and the trade benefits are increased. However, due to the rapid development of the whole world economy, the labor productivity of all countries has been continuously improved in recent years, while the benchmark level of labor productivity in China is very low. Even if it keeps rising in recent years, there is still a big gap compared with developed countries, and the labor productivity level of similar developing countries is also constantly improving. The single factor terms of trade may not well reflect the reality of unequal distribution of trade benefits between countries.
(B) China and its major trading partners price terms of trade comparison.
As an evaluation index to measure the distribution of trade benefits between countries, the price terms of trade mainly reflect the competitiveness of a country's foreign trade. Therefore, by comparing the changes of price terms of trade between countries, we can have a more comprehensive understanding of China's competitiveness and position in international trade. As can be seen from Figure 4, during the period of 1995-2003, the terms of world trade remained basically unchanged; The price terms of trade in developed countries such as the United States have greatly improved since 2000; Although developing countries experienced a sharp deterioration around 2000, there was a trend of improvement afterwards. By comparison, it can be concluded that China's terms of trade have obviously deteriorated. Compared with developed and developing countries, China's terms of trade have deteriorated to a great extent, and its prospects are not optimistic.
(C) Two-factor terms of trade comparison
According to relevant data, the labor productivity of the secondary industry in China declined in the 1980s, but increased significantly after the mid-1990s, showing a relatively accelerated trend, far exceeding the growth rate of the United States, Japan and South Korea, and compared with other developing countries. Because China started early, the growth of labor productivity is also higher than theirs. On the whole, in recent years, the increase of dual-factor labor productivity between China and major trading countries is higher than the decrease of prices, which makes the terms of trade between China and these three major trading countries improved obviously under this index.
However, it must be noted that in fact, China's export products also include a large number of primary products, and the improvement of labor productivity in such industries is not obvious; Moreover, the international comparison of the import and export of manufactured goods shows that there are problems in the import and export structure of China's manufacturing industry. In the 1990s, most of China's export products were "three low" products with low technical content, low unit price and low added value, but a large number of "three high" products with high technical content, high added value and high price were imported, and the actual improvement of labor productivity of export commodities was lower than that of the secondary industry.
Therefore, the actual improvement of China's two-factor terms of trade with major trading countries is less than that shown in Table 3. For some developed countries whose export products are particularly high in technology, the two-factor terms of trade between China and them may even deteriorate.
Table 3: Two-factor terms of trade between China and major trading countries (based on 1995)
Year19951996199719981999 2000 2006 5438+0 2002.
Z Zhong /Z Mei1.001.1.1.1.1.1.
Z /Z seal1.001.071.25 2.87 2.09 2.10 2.39 2.18.
1.00 1.29 15 1 1.73 1.56 1.54 1.9 1 2. 1.
Z Zhong /Z Han1.001.101.241.851.521.491.
Z Zhong /Z De1.001.181.421.471.571.90 2.08 2.06.
DETT Zhongmei10011110599100106.
DETT China India100107125 270185189 212188.
DETT China/KOOC-0/00/KOOC-0/29/KOOC-0/52/KOOC-0/63/KOOC-0/38/KOOC-0/39/KOOC-0/70/KOOC-0/82.
DETT 100 10 124 174 134 155 150。
DETT/KOOC-0/00/KOOC-0/42/KOOC-0/38/KOOC-0/39/KOOC-0/7/KOOC-0/84/KOOC-0/78.
Source: National Statistical Yearbook 2004 and International Economic Yearbook 1999-2004. Due to the lack of data, the labor productivity of import and export commodities is replaced by that of the whole secondary industry.
Four. Conclusions and policy implications
Through the above analysis, we can find that the present situation of our country fully meets the preconditions of immiserizing growth, but only one of the four conditions has deteriorated; The price terms of trade have deteriorated, the income terms of trade have greatly improved, and the single-factor terms of trade have also improved significantly. At least there is no obvious deterioration trend in the terms of trade with two factors. Therefore, it can be judged that China has not shown the characteristics of immiserizing growth at present. The increase in export volume and the increase in labor productivity make up for the decline in prices, and social welfare is on the rise. At present, China benefits from foreign trade. However, considering the long-term development, if China's foreign trade is further expanded, this situation may not last long.
As for the terms of income trade, we can find that the export price index is basically unchanged, but the export quantity index has increased by leaps and bounds. By analyzing the quantity and amount of main export commodities in recent years, it can be found that the rapid growth of export volume is concentrated in automobiles and auto parts, bearings, batteries, cameras and other commodities, which is likely to be the increase of export volume brought about by the rapid development of processing trade and the introduction of foreign capital; In addition, there are labor-intensive and resource-intensive products, such as semiconductors, tape recorders, umbrellas, leather shoes, plastic products, steel, paper and cardboard. However, these labor-intensive products are close to saturation in the international market, and it is difficult to maintain rapid growth from the perspective of the changes in the commodity structure in the international market in the future. The growth rate of export volume is limited. Therefore, if China's foreign trade continues to expand in this way, the income terms of trade will not be further improved, and it may even deteriorate at the same time due to the deterioration of the price terms of trade.
As for the conditions of factor trade, China's major trading countries are developed countries. Because the base of labor productivity in China is very low, and there is a lot of room for improvement, while the developed countries are basically mature in economy and technology, and the level of labor productivity is relatively high, so in recent years, the speed of labor productivity improvement in China is much higher than that in developed countries. However, in recent years, with the substantial increase of labor productivity in developing countries whose productivity level is close to that of China, the ratio of labor productivity between China and developing countries has decreased, which has worsened the terms of trade between China and developing countries. At the same time, with the improvement of labor productivity in China, the rising space decreases and the speed may slow down. If it continues, in the face of the double attack of developed and developing countries, the improvement of labor productivity may not be able to make up for the decline in prices, thus worsening the terms of trade of the two factors.
In a word, although China has not fallen into immiserizing growth at present, the terms of trade are likely to deteriorate further as the space for improving the terms of trade by means of tariffs and quotas becomes smaller and smaller, and the growth rate of export volume is limited. Changes in terms of trade may further erode economic achievements. If this growth continues, the possibility of immiserizing growth still exists.
Therefore, China needs to stabilize the terms of trade from the following aspects, realize the hidden dangers existing in China's current foreign trade expansion, and avoid further deterioration of the terms of trade at prices and immiserizing growth.
(1) Stabilize the prices of imported resources.
In view of China's increasing dependence on the import of some strategic resource products, as well as the scarcity of resources and the needs of economic development, it is an inevitable trend that the prices of important resources in the world will continue to rise. In order to stabilize the price of imported resources, we should diversify and expand import channels, and use domestic resource development projects to enhance our bargaining power with resource suppliers to avoid further increase in the import price index. In addition, China is a big importer of primary products and a big exporter of some primary products. Therefore, the use of commodity futures market can effectively avoid the price risk of international primary product market.
(b) Improve the technical content and added value of export commodities.
First of all, labor-intensive products will still dominate China's exports for a long time. Therefore, the key at this stage should be how to use new technologies, knowledge, information and systems to transform traditional elements, so as to shift the competitive advantage of industries from natural resources and cheap labor to innovation ability, technology and management advantages, and promote the modernization of traditional industries. Develop and transform labor-intensive industries and improve the ability of independent innovation. Secondly, the proportion of processing trade in China's foreign trade is increasing, and the backwardness of processing trade will directly cause the phenomenon that China's exports will not increase in price. Therefore, it is necessary to introduce technology, strengthen independent innovation ability, integrate domestic and foreign technological innovation resources, realize the transformation of traditional industries by technology, improve the level of processing trade industry and enhance domestic supporting capacity, and extend the industrial chain from the assembly of final products to upstream parts and downstream service industries. Gradually establishing overseas marketing channels and reducing the export of low value-added primary products will be an important part of improving China's terms of trade.
Increase orderly competition
In addition to the adjustment of industrial structure and trade strategy, the government should also have corresponding laws or policies to restrain and punish the widespread price transfer and vicious competition of multinational companies, which have had a bad impact on international trade and caused the deterioration of China's terms of trade to a certain extent. For example, we should promote anti-unfair competition legislation and form a sound legal system. Promote the merger and reorganization of all kinds of enterprises, including foreign trade enterprises, avoid repeated construction, form the advantages of scale operation, and enable enterprises to enter the international market by means of comprehensive competition rather than price. Make full use of various means allowed by the WTO to protect China's industrial interests and truly play the role of tariff protection and improving trade conditions.
(4) Promoting technological innovation and popularizing professional skills education.
Today, with the high development of science and technology, technological progress and innovation are the only way to improve China's two-factor terms of trade and increase labor productivity. The low level of labor productivity is directly related to the lack of skilled labor in China. Only by strengthening the training of labor force, especially professional and technical education, strengthening the skills training of employees in traditional industries, improving the quality of workers and improving the ability of independent innovation can the conditions of factor trade be improved.