Analysis of the Induction and Dependence Relationship between Foreign Final Demand and China's Output

In order to study the relationship between the foreign final demand and China's output, this paper develops the induction coefficient and dependence degree based on the inter-regional input-output model, and calculates them using the world input-output table with seven regions, i.e. EU, US, China, Japan, South Korea, other East Asia countries and rest of the world from 1995 to 2011. The results show that: final demand from the US and the EU contribute most to China's output. China's output has larger dependence degree on foreign consumption demand of other countries while smaller dependence degree on foreign investment. However, the former has trend of decline while the later is on the rise.