Policy Analyses
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Policy Analyses
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Marginal Intra-industry Trade, Trade-induced Adjustment Costs and the Choice of FTA Partners
In recent years a new regionalism has begun to emerge in East Asia. Korea is no exception. Inside Korea, however, there are many arguments against opening its domestic market for the foreign competition resulting from a free trade..
Chan-Hyun Sohn et al. Date 2004.12.30
Trade structure, Trade policyDownloadContentExecutive Summary
I. Introduction
II. Trends and Extents of IIT and MIIT
1. The Indices of IIT and MIIT
2. Extents of IIT and MIIT
III. The Determinants of Intra-industry Trade
1. Hypotheses of IIT Analysis
2. Results of Analysis
IV. The Determinants of Marginal Intra-industry Trade
1. Hypotheses of MIIT Analysis
2. Results of Analysis
V. Summary and Concluding Remarks
References
Appendix TablesSummaryIn recent years a new regionalism has begun to emerge in East Asia.
Korea is no exception. Inside Korea, however, there are many arguments against opening its domestic market for the foreign competition resulting from a free trade agreement (FTA). The main reason is because the FTA would result in costly factor adjustment. It has been argued by many researchers that intra-industry trade generates smaller inter-industry factor adjustment than inter-industry trade, and hence intra-industry trade involves lower adjustment costs than inter-industry trade. (The rest is omitted.) -
Monetary and Exchange Rate Arrangements in East Asia
As the culprit for the crisis in 1997-1998, regional exchange rate instability called for dramatic changes in the mindset of policy makers. While as a result the exchange rate regimes in East Asian nations went through quite diver..
Yonghyup Oh et al. Date 2004.12.30
Financial integration, Monetary policyDownloadContent1. Monetary Arrangements in East Asia (Woosik Moon, Deok Ryong Yoon)
2. Exchange Rate Arrangements in East Asia (Eiji Ogawa, Doo Yong Yang)
3. Fear of Floating in East Asia (Soyoung Kim, Sunghyun H. Kim, Yunjong Wang)
4. Reserve Management Policy in East Asia (Jung Sik Kim, Jie Li, Kishen Rajan
and Thomas Willet)
5. Exchange Rate Regime and Economic Linkages in East Asia (Jong-Wha Lee,
Kwanho Shin)
6. Exchange Rate Pass-through in East Asia (Sammo Kang, Yunjong Wang)
7. A Critical Evaluation of OCA Analysis for East Asia (Kwanho Shin and Tom
Willet)
8. Coupling or Decoupling of Won/Yen Exchange Rate (Jaeyoung Kim, Yunjong Wang)
9. Inflation Targeting in East Asia (Yeongseob Rhee, Barry Eichengreen)
10. Untitled (Shang-Jin Wei, IMF)
11. Towards an Integrated Monetary Zone (Yung Chul Park, Charles Wyplosz)
SummaryAs the culprit for the crisis in 1997-1998, regional exchange rate instability called for dramatic changes in the mindset of policy makers. While as a result the exchange rate regimes in East Asian nations went through quite diverse paths, the exchange rates of East Asian countries are still vulnerable and exchange rate stabilization is a key policy objective.
This volume deals with subjects such as post-crisis exchange rate behaviors in East Asia, foreign reserve management and financial marketintegration in East Asia, and the link between exchange rate arrangements and the real economy. Papers on post-crisis exchange rate behaviors examine whether the fear of floating or bi-polar view is supported with the data since the crisis, test ahypothesis of band reverting behavior of Korean Won and Japanese Yen against the US Dollar, or provide critical evaluations on the practicality of the proposals made on exchange rate arrangements in East Asia. Papers on foreign reserve management and financial market integration in East Asia support the view that Asian countries are more integrated with the US than with each other and show that the level of foreign reserves held by East Asian countries is higher than optimal. Papers on exchange rate arrangements and the real economy study the impact on real economic variables through the credit channel, the impact of China's export-driven growth to its neighbor economies and the linkage between exchange rate regimes and real activities such as trade and real business cycles. -
Geographic Concentration and Industry Characteristics: An Empirical Investigation of East Asia
In this paper, we assess the geographic concentration of 26 manufacturing industries over the 1986-1997 period, based on annual employment data for 8 East Asian countries. (The rest is omitted.)
Soon-Chan Park et al. Date 2004.12.30
Economic integrationDownloadContentExecutive Summary
I. Introduction
II. An Overview of the Literature on Industry Location: Traditional Trade Theory versus New Economic Geography
III. Industry Characteristics and Concentration
IV. The Relationship between Geographic Concentration and Industry Characteristics
V. Concluding Remarks
References
AppendixSummaryIn this paper, we assess the geographic concentration of 26 manufacturing industries over the 1986-1997 period, based on annual employment data for 8 East Asian countries. (The rest is omitted.) -
Location Choice of Multinational Companies in China: Korean and Japanese Companies
By using aggregate and firm level data of Korean and Japanese foreign affiliates in China, we investigated the recent FDI trends and the determinants of location choice. Comparing to the FDI trends of Japanese companies, it was sh..
Sung Jin Kang et al. Date 2004.12.30
Overseas direct investmentDownloadContentExecutive Summary
I. Introduction
II. General Characteristics of FDI in China
III. Empirical model specification
IV. Data and descriptive statistics
V. Estimation results
VI. Conclusion
ReferencesSummaryBy using aggregate and firm level data of Korean and Japanese foreign affiliates in China, we investigated the recent FDI trends and the determinants of location choice. Comparing to the FDI trends of Japanese companies, it was shown that Korean companies are too much concentrated into China, especially three regions of northeast of China. (The rest is omitted.) -
FTAs between Korea and Major Trading Partners and Their Policy Implications
Chile was Koerea갽s first choice for an FTA partner after the Korean government갽s decision to promote FTA. Until now, Korea갽s FTA partners are small and midium sized countries except Japan. However,..
Moonsung Kang et al. Date 2004.12.30
Free tradeDownloadContentSummaryChile was Koerea갽s first choice for an FTA partner after the Korean government갽s decision to promote FTA. Until now, Korea갽s FTA partners are small and midium sized countries except Japan. However, FTAs with major trading partners should be pursued based on their economic and political effects on Korea. (The rest is omitted.) -
Korea-U.S. FTA: Trade and Investment Creation Effects and Trade Structure
In this book, we analyze how a Free Trade Agreement (FTA) between Korea and the United States affects bilateral trade and foreign direct investment (FDI). In addition, we also explore the trade structure between Korea and the Unit..
Soon-Chan Park et al. Date 2004.12.30
Economic openingDownloadContentSummaryIn this book, we analyze how a Free Trade Agreement (FTA) between Korea and the United States affects bilateral trade and foreign direct investment (FDI). In addition, we also explore the trade structure between Korea and the United States. (The rest is omitted.) -
Japan-Korea Free Trade Agreement: Policy Implications and Effects on the Domestic Parts Industry
This study conducts a quantitative research on implications of a Japan-Korea Free Trade Agreement, looking at some possible vulnerabilities involving the parts industries of electric, electronics, and machinery, and to suggest a l..
Hongbae Lee et al. Date 2004.12.30
Economic cooperation, Free tradeDownloadContentSummaryThis study conducts a quantitative research on implications of a Japan-Korea Free Trade Agreement, looking at some possible vulnerabilities involving the parts industries of electric, electronics, and machinery, and to suggest a list of effects that would be generated by an elimination of customs at the signing of the agreement. (The rest is omitted.) -
Korean firms invested in China: Survey of management practices and implications
Korean firms' FDI into China has been increasing rapidly since 2001. The main features of Korean FDI into China can be summarized as being more manufacturing oriented, and having a high ratio of SMEs and relatively small investmen..
Man Soo Jee et al. Date 2004.12.30
Economic cooperation, Overseas direct investmentDownloadContentSummaryKorean firms' FDI into China has been increasing rapidly since 2001. The main features of Korean FDI into China can be summarized as being more manufacturing oriented, and having a high ratio of SMEs and relatively small investment size. (The rest is omitted.) -
North Korea's Price Management and Commercial Distribution System: Current Status and Reform Tasks
North Korea's commerce system supplies goods such as daily necessities to the public. North Korean workers are paid in cash for their labor according to quality and quantity. Citizens use their salaries to purchase food and goods ..
Date 2004.12.30
North Korean economyDownloadContentSummaryNorth Korea's commerce system supplies goods such as daily necessities to the public. North Korean workers are paid in cash for their labor according to quality and quantity. Citizens use their salaries to purchase food and goods at state-run stores at official prices. Formerly, official prices applied to all goods sold to the public. However, in July 2002, the government steeply raised official prices, and changes have followedin many areas. While some changes have been positive, such as greater profit-seeking in economic management and the possibility of earning additional income, other changes have been negative, including public discontent and surging black-market prices caused by supply and demand imbalances. These are the main problems currently faced by North Korea's commerce and distribution sector. (The rest is omitted.) -
Changes in the Beef Market after Import Liberalization: Analysis and Implication
The importing of beef was liberalized through imposing a tariff in 2001 which shifted from a quota since the conclusion of the UR in 1994. With the opening of a beef market, livestock farms and farmers' groups were concerned that ..
Ji Hyun Park Date 2004.12.30
Economic opening, Free tradeDownloadContentSummaryThe importing of beef was liberalized through imposing a tariff in 2001 which shifted from a quota since the conclusion of the UR in 1994. With the opening of a beef market, livestock farms and farmers' groups were concerned that damages from liberalization would grow serious and their breeding bases would eventually collapse. In other words, they argued that the liberalization of a beef market would result in: 1) the reduction of farmers' income due to the decreasing price of beef; 2) the collapse of a breeding base due to the reduction in production; and 3) the increase in imports and the decrease in the self-sufficiency rate. (The rest is omitted.)