KDI Journal of Economic Policy

Korea Development Institute (한국개발연구원)
권호 표지

The Interaction between China, Japan, and Korea in the Export Market

  • Received : 2015.07.28
  • Published : 2016.05.31
Download PDF
⟨ Previous Next ⟩

Abstract

This paper analyzes changes in the export potential and competitiveness of China, Japan, and Korea. The analysis of Japan's export market share reveals that in sectors where Korea's potential was strong in the early 1990s, Japan's market share diminished. This suggests the possibility that Korea was catching up with Japan, eating into Japan's market share. The same analysis of Korea's export market share in the 2000s shows, for items in which China's export potential was high, Korea's market share has declined comparatively since 2010, with the tendency growing much larger. China's export potential continues to expand in markets for Korea's key export products, making it difficult to rule out the possibility that Korea's competitiveness in key export products will be hindered, driven by the catching up of China. To respond to these challenges, it is important for Korea continuously to foster and enhance creative and core capabilities that latecomers will not easily be able to emulate.

Keywords

References

  1. Amiti, Mary and Caroline Freund. 2010. "The Anatomy of China's Export Growth." In China's Growing Role in World Trade, edited by Feenstra, Robert C. and Shang-Jin Wei, 35-56. Chicago: University of Chicago Press.
  2. Balassa, Bela. 1965. "Trade Liberalisation and 'Revealed' Comparative Advantage." Manchester School 33 (2): 99-123. https://doi.org/10.1111/j.1467-9957.1965.tb00050.x
  3. Cho, Dongchul. 2014. Economic Dynamism of Korea: With a Focus on the Comparison with Japan. Research Monograph 2014-03. Korea Development Institute (in Korean).
  4. Choi, Namsuk. 2014. Economic Complexity for Growth: Evidence from Productive Knowledge in Korean Value-Added Trade. Research Reports 14-08. Korea Economic Research Institute (in Korean).
  5. Choi, Yong-Seok, MoonJoong Tcha, and Jong-il Kim. 2005. China's Growing Economy and Its Implications for the Korean Economy. Research Monograph 2005-04. Korea Development Institute (in Korean).
  6. Hausmann, Ricardo, Jason Hwang, and Dani Rodrik. 2007. "What You Export Matters." Journal of Economic Growth 12: 1-25. https://doi.org/10.1007/s10887-006-9009-4
  7. Hidalgo, Cesar A., and Ricardo Hausmann. 2008. "A Network View of Economic Development." Developing Alternatives 12 (1): 5-10.
  8. Hidalgo, Cesar A., Bailey Klinger, Albert-Laszlo Barabasi, and Ricardo Hausmann. 2007. "The Product Space Conditions the Development of Nations." Science 317 (5837): 482-487. https://doi.org/10.1126/science.1144581
  9. Johnson, Rober C. 2014. "Five Facts about Value-Added Exports and Implications for Macroeconomics and Trade Research." Journal of Economic Prespectives 28 (2): 119-142. https://doi.org/10.1257/jep.28.2.119
  10. Jung, Kyu-Chul. 2014 "Impacts of China's Economic Structural Changes on the Korean Economy." KDI Economic Outlook 31 (2): 55-61 (in Korean).
  11. Koopman, Robert, Zhi Wang, and Shang-Jin Wei. 2014. "Tracing Value-Added and Double Counting in Gross Exports." American Economic Review 104 (2): 459-494. https://doi.org/10.1257/aer.104.2.459
  12. Lee, Keun and Chaisung Lim. 2001. "Technological Regimes, Catching-Up and Leapfrogging: Findings from the Korean Industries." Research Policy 30: 459-483. https://doi.org/10.1016/S0048-7333(00)00088-3
  13. Lee, Siwook. 2008. Changes in Trade Structure between China and Korea and Macroeconomic Implications. Policy Study 2008-15. Korea Development Institute (in Korean).
  14. Mu, Qing and Keun Lee. 2005. "Knowledge Diffusion, Market Segmentation and Technological Catch-Up: The Case of the Telecommunication Industry in China." Research Policy 34: 759-783. https://doi.org/10.1016/j.respol.2005.02.007
  15. Obstfeld, Maurice. 2011. "Time of Troubles: the Yen and Japan's Economy, 1985-2008." In Japan's Bubble, Deflation, and Long-Term Stagnation, edited by Hamada, Koichi, Anil K Kashyap, and David E. Weinstein, 51-103. Cambridge: MIT Press.
  16. Poncet, Sandra and Felipe Starosta de Waldemar. 2015. "Product Relatedness and Firm Exports in China." World Bank Economic Review 29 (3): 579-609. https://doi.org/10.1093/wber/lht037
  17. Shin, Hyonsoo, and Wonbok Lee. 2003. An Analysis of Manufacturing Competitiveness of Korea, Japan, and China and Its Policy Implications. Issue Paper 2003-128. Korea Institute for Industrial Economics and Trade (in Korean).
  18. Timmer, Marcel P., Abdul Azeez Erumban, Bart Los, Robert Stehrer, and Gaaitzen J. de Vries. 2014. "Slicing Up Global Value Chains." Journal of Economic Prespectives 28 (2): 99-118.
  19. Youn, Woojin. 2013. Creative Economy and the Dynamics of Industry and Trade. Issue Paper 2013-322. Korea Institute for Industrial Economics and Trade (in Korean).