Complex System Research on China-EU Trade Based on Bilateral Policy Knowledge Extraction

Abstract

Against the backdrop of reshuffled global economic governance and rising unilateralism, China and the EU, as two core global economies, share bilateral trade ties critical to world economic stability. In 2020, China proposed the dual-circulation new development strategy; meanwhile, the negotiation of the Comprehensive Agreement on Investment (CAI) between China and the EU was finalized, marking a breakthrough in cross-border institutional coordination. Taking China-EU institutional relations as the core explanatory variable, this paper constructs a theoretical framework of “institutional coordination – bilateral trade effect” based on trade gravity model and institutional complementarity theory. Using panel data covering 2001–2024, we quantify institutional coordination intensity via policy text scoring (policy objective score + policy measure score + policy weight). Two-way fixed-effect model, System GMM dynamic panel, mediating effect model and heterogeneous regression are adopted for empirical tests. The results show that: (1) Deepened China-EU institutional coordination significantly expands total bilateral trade, and the conclusion passes multiple robustness and endogeneity tests; (2) Institutional trade dividends show industrial heterogeneity: technology-intensive > capital-intensive > labor-intensive sectors; (3) The dual-circulation strategy positively moderates the trade promotion effect of institutional relations; (4) Institutional coordination boosts trade by two channels: tariff reduction and intermediate goods value chain integration. Finally, differentiated industrial coordination and rule convergence policy suggestions are put forward.