• Economic Analysis
• /
• v.27 no.4
• /
• pp.43-69
• /
• 2021

As the trade linkages and the financial relationship between China and Korea grow stronger, China's influence on Korea is also growing larger. Therefore, it is meaningful to examine key features of Chinese monetary policy operations and the current situation, and to analyze the transmission mechanism of China's monetary policy shocks onto the Korea economy. China's monetary policy shocks can have an impact on the Korea economy through the trade, financial and oil-price channels. In the trade channel, an expansionary Chinese monetary policy can increase Korea's exports of intermediate goods to China under the vertical trade structure, via the vertical trade integration effect. Meanwhile, the expenditure switching effect and the income demand effect show no statistical significance. In the financial and oil-price channels, expansionary Chinese monetary policy shocks can decrease the interest rate and increase both stock prices and the consumer price index in Korea through changes in global portfolio capital flows, interest rates, and raw material prices.

• Economic Analysis
• /
• v.27 no.2
• /
• pp.1-40
• /
• 2021

Using an unobserved components model that features trend growth as a random walk, we find that GDP trend growth rates had gradually declined from the late 1980s to early 2010s in Korea. To uncover the underlying features of the slowdown, we use trend growth accounting. A major feature appears to be a significant decline in the growth rate of labor productivity. To be specific, the first gradual decline in trend growth, which started in 1988 and continued to 1998, is associated with a drop in TFP measured in labor-augmenting units. This finding is inconsistent with the hypothesis that the slowdown in GDP trend growth can be attributed to the 1997-1998 Korean financial crisis. Sluggish investment growth is behind the second period of the gradual slowdown, from 2002 to 2012.

• Economic Analysis
• /
• v.25 no.3
• /
• pp.1-29
• /
• 2019

This paper examines the impact of a dual labor market structure on labor productivity using unbalanced panel data from 29 OECD member countries between 1990 and 2015. By applying a variety of regression models on the panel data (e.g., a pooled regression, a fixed effects model and a GMM), we explore how changes in worker-type composition among temporary, permanent and self-employed workers contribute to productivity growth. While it appears that our results differ slightly, depending on the econometric models, overall an increase in the share of permanent workers leads to a relatively higher increase in productivity growth. On the other hand, it is also seen that the effects of the share of temporary workers on labor productivity are considerably lower than that of permanent and self-employed workers. To sum it up, our findings indicate that an increase in temporary workers could have an adverse effect on labor productivity.

• KDI Journal of Economic Policy
• /
• v.12 no.3
• /
• pp.71-94
• /
• 1990

This paper reviews the rationale of monetary and banking intervention by an outside authority, either the government or the central bank, and seeks to delineate clearly the optimal limits to the monetary and banking deregulation currently underway in Korea as well as on a global scale. Furthermore, this paper seeks to establish an objective and balanced view on the role of the central bank, especially in light of the current discussion on the restructuring of Korea's central bank, which has been severely contaminated by interest-group politics. The discussion begins with the recognition that the modern free banking school and the new monetary economics are becoming formidable challenges to the traditional role of the government or the central bank in the monetary and banking sector. The paper reviews six arguments that have traditionally been presented to support intervention: (1) the possibility of an over-issue of bank notes under free banking instead of central banking; (2) externalities in and the public good nature of the use of money; (3) economies of scale and natural monopoly in producing money; (4) the need for macro stabilization policy due to the instability of the real sector; (5) the external effects of bank failure due to the inherent instability of the existing banking system; and (6) protection for small banknote users and depositors. Based on an analysis of the above arguments, the paper speculates on the optimal role of the government or central bank in the monetary and banking system and the optimal degree of monetary and banking deregulation. By contrast to the arguments for free banking or laissez-faire monetary systems, which become fashionable in recent years, monopoly and intervention by the government or central bank in the outside money system can be both necessary and optimal. In this case, of course, an over-issue of fiat money may be possible due to political considerations, but this issue is beyond the scope of this paper. On the other hand, the issue of inside monies based on outside money could indeed be provided for optimally under market competition by private institutions. A competitive system in issuing inside monies would help realize, to the maxim urn extent possible, external economies generated by using a single outside money. According to this reasoning, free banking activities will prevail in the inside money system, while a government monopoly will prevail in the outside money system. This speculation, then, also implies that the monetary and banking deregulation currently underway should and most likely will be limited to the inside money system, which could be liberalized to the fullest degree. It is also implied that it will be impractical to deregulate the outside money system and to allow market competition to provide outside money, in accordance with the arguments of the free banking school and the new monetary economics. Furthermore, the role of the government or central bank in this new environment will not be significantly different from their current roles. As far as the supply of fiat money continues to be monopolized by the government, the control of the supply of base money and such related responsibilities as monetary policy (argument(4)) and the lender of the last resort (argument (5)) will naturally be assigned to the outside money supplier. However, a mechanism for controlling an over-issue of fiat money by a monopolistic supplier will definitely be called for (argument(1)). A monetary policy based on a certain policy rule could be one possibility. More importantly, the deregulation of the inside money system would further increase the systemic risk inherent in the current fractional banking system, while enhancing the efficiency of the system (argument (5)). In this context, the role of the lender of the last resort would again become an instrument of paramount importance in alleviating liquidity crises in the early stages, thereby disallowing the possibility of a widespread bank run. Similarly, prudential banking supervision would also help maintain the safety and soundness of the fully deregulated banking system. These functions would also help protect depositors from losses due to bank failures (argument (6)). Finally, these speculations suggest that government or central bank authorities have probably been too conservative on the issue of the deregulation of the financial system, beyond the caution necessary to preserve system safety. Rather, only the fullest deregulation of the inside money system seems to guarantee the maximum enjoyment of external economies in the single outside money system.

• KDI Journal of Economic Policy
• /
• v.14 no.1
• /
• pp.191-212
• /
• 1992

This paper discusses the role of money in the process of capital accumulation where financial markets are impeded by contract enforcement problems in the context of overlapping generations framework. In particular, in less developed countries (LDCs) creditors may know little about the repayment capability of potential debtors due to incomplete information so that financial instruments other than money may not acceptable to them. In this paper the impediments to the operation of the private finanical markets are explicitly modelled. We argue that creditors cannot observe actual investment decisions made by the potential borrowers, and as a result, loan contracts may not be fully enforceable. Therefore, a laissez-faire regime may fail to provide the economy with the appropriate financial instruments. Under these circumstances, we introduce a government operated discount window (DW) that acts as an open market buyer of private debt. This theoretical structure represents the practice of governments of many LDCs to provide loans (typically at subsidized interest rates) to preferred borrowers either directly or indirectly through the commercial banking system. It is shown that the DW can substantially overcome impediments to trade which are caused by the credit market failure. An appropriate supply of the DW loan enables producers to purchase the resources they cannot obtain through direct transactions in the credit market. This result obtains even if the DW is subject to the same enforcement constraint that is responsible for the market failure. Thus, the DW intervention implies higher investment and output. However, the operation of the DW may cause inflation. Furthermore, the provision of cheap loans through the DW results in a worse income distribution. Therefore, there is room for welfare enhancing schemes that utilize the higher output to develop. We demonstrate that adequate lump sum taxes-cum-transfers along with the operation of the DW can support an allocation that is Pareto superior to the laissez-faire equilibrium allocation.

• Economic Analysis
• /
• v.25 no.1
• /
• pp.34-65
• /
• 2019

This paper investigates the effects on Korean exports of demand in developed economies, and how these effects have changed since the global financial crisis. As a measure of import demand, we use import intensity-adjusted demand to take into account heterogenous import intensities across components of aggregate demand. Our estimation of a dynamic panel regression model reveals that Korea's exports to the G7 countries were elastic with respect to the import demand of these countries until the global financial crisis, but have shifted to become inelastic since. Furthermore, we separately estimate the effects of the different components of the G7 countries' aggregate demand (private consumption, public consumption, investment and exports). The results show that the decrease in private consumption in the G7 countries during the crisis had a significant impact in causing the decline in Korea's exports to them, but that the increase in their public consumption since the crisis has had a significant effect on driving increased Korean exports to them. The effects of the G7 countries' exports on Korea's exports to them remain positive and significant during both the pre- and post-crisis periods. The effects of the G7 countries' investments on Korea's exports are also positive and significant, but the positive effect has weakened since the crisis. Our findings suggest that the overall effect of changes in the G7 countries' import demand on Korea's exports to them has weakened compared to the pre-crisis period.

• Journal of Information Management
• /
• v.40 no.1
• /
• pp.157-181
• /
• 2009

As the information technology is evolved and the human genome project is finalized over the world, the Bioinformatics - the integration of abundant Biological science and information technology - has shown up and is continuously being advanced. Together with the evolution of Bioinformatics, the websites dealing with Bioinformation have been set up to provide relevant information to the Bioscientists. Among the numerous global websites, the preferred websites by the majority of domestic Bioscientists are BRIC (Biological Research Information Center) of POSTECH(Pohang University of Science and Technology) in Korea, CCBB(Center for Computational Biology and Bioinformatics) of KISTI(Korea Institute of Science and Technology Information), KOBIC(Korean Bioinformation Center) of KRIBB(Korea Research Institute of Bioscience and Biotechnology), NCBI(National Center for Biotechnology Information) in USA, EBI(European Bioinformatics Institute) in Europe and DDBJ(DNA Data Bank of Japan) in Japan. In this paper, the comparative analysis was executed by investigating contents status and functions of the above-mentioned 6 websites. In addition, questionnaire survey of Bioscience Researchers' utilization status and their needs to those 6 websites was conducted.

• Journal of agriculture & life science
• /
• v.50 no.1
• /
• pp.95-104
• /
• 2016

The objective of this paper is to develop volume equation of street tree and its carbon stock for urban forest in Seoul. To develop the volume equation by major species in Seoul, data for street trees were obtained from four-species (e.g. Gingko biloba, Platanus occidentalis, Zelkova serrata, and Metasequoia glyptostroboides), which accounted for 79% all street trees in Seoul. This study used a variable based on diameter on breast height and four equation for calculating volume. The coefficient of determination, bias, and root mean square error were used to evaluate the precision of four equations. From these methods, the most suitable equations for Platanus occidentalis was aDb, the other was aD+bD2; coefficient of determination upper on 0.873. From the volume equation developed in this research, the estimated carbon stock were derived as about 33,760tC for four-species of urban forest in Seoul. The results of this paper offered volume equation and carbon stock that present growth information for street trees in urban forestry and these can be made available for evaluating the management for carbon in settlement.

• KDI Journal of Economic Policy
• /
• v.46 no.1
• /
• pp.91-129
• /
• 2024

The Bank of Korea, through a legal amendment in 2011 following the financial crisis, was entrusted with the additional responsibility of financial stability beyond its existing mandate of price stability. Since then, concerns have been raised about the prolonged increase in household debt compared to income conditions, which could constrain consumption and growth and increase the possibility of a crisis in the event of negative economic shocks. The current accumulation of financial imbalances suggests a critical period for the government and central bank to be more vigilant, ensuring it does not impede the stable flow of our financial and economic systems. This study examines the applicability of the Integrated Inflation Targeting (IIT) framework proposed by the Bank for International Settlements (BIS) for macro-financial stability in promoting long-term economic stability. Using VAR models, the study reveals a clear increase in risk appetite following interest rate cuts after the financial crisis, leading to a rise in household debt. Additionally, analyzing the central bank's conduct of monetary policy from 2000 to 2021 through DSGE models indicates that the Bank of Korea has operated with a form of IIT, considering both inflation and growth in its policy decisions, with some responsiveness to the increase in household debt. However, the estimation of a high interest rate smoothing coefficient suggests a cautious approach to interest rate adjustments. Furthermore, estimating the optimal interest rate rule to minimize the central bank's loss function reveals that a policy considering inflation, growth, and being mindful of household credit conditions is superior. It suggests that the policy of actively adjusting the benchmark interest rate in response to changes in economic conditions and being attentive to household credit situations when household debt is increasing rapidly compared to income conditions has been analyzed as a desirable policy approach. Based on these findings, we conclude that the integrated inflation targeting framework proposed by the BIS could be considered as an alternative policy system that supports the stable growth of the economy in the medium to long term.

• Land and Housing Review
• /
• v.13 no.3
• /
• pp.1-20
• /
• 2022

This study analyses how much Korean visits to North Korea have an impact on the North Korean regional economy. It estimates the demand for North Korean tourism via the borders of North Korea, China, and Russia and South Korean expenses to be spent in North Korea. When asked if they are willing to visit North Korea within the next five years in case the pre-conditions of the visit to North Korea are satisfied, approximately 64.1% of the survey respondents indicated 'yes'. To estimate the demand, this research employed the analysis of purchase intention, popular in marketing, based on their willingness to visit. The annual demand for tourism was 4,136,361 persons. The average estimated expense per person is KRW 1,532,000 and the total annual expense is KRW 6,336.9 billion. Assuming that airfare is excluded from the total expense and the expense is made evenly in each tourist destination, the estimated amount to be spent in North Korea is KRW 2,838.7 billion per annum. The backward linkage effect of this expense on the North Korean regional economy is KRW 7,972.1 billion in total production inducement, KRW 2,619.4 billion in value-added inducement, and approximately 2,890,443 persons in employment inducement. The value-added inducement effect is estimated to be approximately 7.6% of the North Korean nominal GDP in 2020. South Korean tourism is expected to have a significant impact on the North Korean economy. As the demand for North Korean tourism is likely to increase steadily due to the expected increase in overseas travel demand by Koreans, inter-Korean cooperation is needed for the development of North Korean tourism infrastructure if conditions improve.