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Foreign Trade, Economic Growth and Evolution of Industrial Structure in China
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TitleForeign Trade, Economic Growth and Evolution of Industrial Structure in China  
AuthorZhang Jie, Zhang Yuanyuan and Mo Yang  
OrganizationCollege of Economics, Jinan University, 
Key WordsForeign Trade; Industrial Structure; Industrialization; Tertiarization; Evolution 
AbstractThis paper observes the changes of industrial structure since the adoption of reform and opening-up policy in China and finds that service sector has developed slowly over the past decade and evolution of industrial structure is inclined to stagnate. From the perspective of international "manufacturing-service" division of labor, we explore reasons for the stagnation of industrial structure and construct theoretical models to prove that over development of exports will make the crowding out effect on service sector larger than income effect and correlative effect in the "manufacturing-service" division system, leading industrial structure locked into the trap of “over-industrialization at low level”. Furthermore, we take empirical analysis through a simultaneous equation model and provide some preliminary evidence to our hypothesis above. It is concluded that export-oriented development pattern has accelerated industrialization but would probably inhibit industrial structure transforming from industrialization to tertiarization. After the International Financial Crisis, China need to change its development pattern in order to promote the transformation and upgrading of industrial structure. 
Serial NumberWP240 
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