Export Value-Added of China's Manufacturing Sector:Estimation and Mechanism Analysis

Estimation of domestic and overseas value-added of manufacturing sector is an important and difficult subject for the science-based evaluation of a country’s trade interests under global value chain.Traditional HIY approach overestimates the domestic valueadded of export.Although Koopman ’s method made certain improvements,it cannot utilize traditional I/O matrix and direct input coefficient matrix under the condition of incomplete information.By creating GAMS model,this paper addresses the above-mentioned problems and employs an improved model for the estimation of variations in domestic and overseas value-added of Chinese exports between 2002 and 2012.Our results indicate that by neglecting the export of processing trade,HIY approach overestimates the domestic valueadded ratio of Chinese exports.As more imported intermediate inputs have been used in the export of processing trade,the estimation result of this paper have corrected deviations in the forecast of overseas value-added ratio and its tendencies based on HIY method.Further analysis of specific factors of domestic value-added of export led to the discovery that the domestic value-added of export of processing trade and mixed trade is highly vulnerable to the impact of international capital inflow.It can be seen that the improved method for the estimation of value-added has indeed corrected the deviations in the estimation of China’s value-added.In conclusion,China should accelerate the development of export of nonprocessing trade and trade in high-end services,and balance the relationship of export between local firms and foreign-funded firms,with a view to improving trade dependence and increasing the trade status of Chinese manufacturing firms in global value chain.