The Effects of Exchange Rate on China's Imports and Exports: An Empirical Research Based on the Dynamic Bayesian Network

The paper divides China's foreign trade goods into nine categories based on the SITC (Standard International Trade Classification), uses the dynamic Bayesian Network method inspecting the relationship between the exchange rate and other real economic factors and China's foreign trade. There exist some differences between the result of whole angle of view and that of based on the sub-sector angle. We find our country's export influenced largely by the world's demand level. Furthermore, our country's demand has more influence effect than exchange rate on the import.