Empirical Study of the Relationship between Foreign Openness and China's Industrial Structure

Abstract

Using the data from 1985 to 2010, the paper estimates the China Foreign Openness and the high-class of Industrial Structure and employs co-integration, error correction model, Granger causality test and impulse function to investigate the relationship between the China Foreign Openness and the high-class of Industrial Structure. The study shows: Industrial Structure and China Foreign Openness exists the long-term equilibrium relationship; one-way Granger causality exists between China's Industrial Structure and opening, China Foreign Openness will promote the high-class of Industrial Structure. On this basis, the relevant policy recommendations.