International Journal of Business and Social Science

ISSN 2219-1933 (Print), 2219-6021 (Online) DOI: 10.30845/ijbss

Research on the Relationship between China’s Foreign Trade and Economic Growth Based on VAR
YU Lin, SUN Ming-gui

Since reform and opening up, our national economy has been developing fast and foreign trade is presenting a state of rapid development. Foreign trade has been expanding steadily and its structure has been optimized continuously. This paper analyzes the relationship between China’s GDP, the import volume and the export volume using the VAR model according to the statistical data for the period 1978 to 2008 and finds that there is a long-term dynamic and balanced relationship between them. The export trade has a considerable pushing effect on our economic development for a long period of time while the import trade has a far less influence on GDP than the export trade does.

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