The effects of the RMB's appreciation on trade balance in US

Chi Gong; 유자양

Journal of The Korea Society of Computer and Information

Abbr : JKSCI
2015, 20(11), pp.135-142
Publisher : The Korean Society Of Computer And Information
Research Area : Computer Science

Chi Gong ¹, 유자양 ²

¹서울대학교 국제대학원 경제학과
²경기대학교 경상대학 경영학부

ABSTRACT

This paper applied a VAR model to analyze the effects of RMB exchange rate brought to processing trade, non-processing trade and FDI. Then we can get the results that the appreciation of RMB could not solve the problem of US trade deficit. It is more likely that the appreciation just can transfer the trade imbalance to other country with US, which could not radically solve the economic problems of US. Also this paper find that the data of service trade is surplus while the main goods deficit was occur in advanced technology product, especially in the information & communications trade And US has real advantage in these industries, so the situation will be changed if US decreased the barrier in these industries. In that way, the imbalance situation should be greatly reduced.
KEYWORDS

RMB's appreciation, trade balance, processing trade, FDI, advanced technology product trade, information & communications trade
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