System Analysis of International Trade Network Based on Difference-in-Difference Method

By actively promoting the signing of free trade agreements, it will be possible to promote the development of China's export trade. Based on the HS6 quantile product level data of China's exports to 123 countries from 2002 to 2020, this paper uses the trade margin decomposition method of Hummels, Klenow (2005), and Shi Bingzhan (2010) to calculate the trade margin of China's export countries, and through empirical analysis, explores the impact of Free Trade Agreements (FTA) on China's export trade. The research shows that FTA has a significant role in promoting the total share, quantity margin, and price margin of China's export trade, and has a significant inhibitory effect on the extensive margin. The impact on the intensive margin is greater than the extensive margin, and the impact on the price margin is greater than the quantity margin. The findings of this paper provide an important policy rationale for China to accelerate its FTA strategy.