• Title/Summary/Keyword: Export Competition

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A Study on the Prediction Model for International Trade Payment Using Logistic Regression

  • Joo, Hye-Young;Lee, Dong-Jun
    • Journal of Korea Trade
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    • v.25 no.2
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    • pp.111-133
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    • 2021
  • Purpose - Although remittance payment in international trade settlements has played a bigger role in recent years, scant research is being done. This study is to zero in on analyzing determinants of international trade payments focused on remittance by constructing a payment prediction model. Design/methodology - This study categorizes the types of trade payments into advance remittance, post remittance, linked remittance, letter of credit, and mixed payment, and analyzes these after constructing a logit model. For empirical analysis, 147 survey data were collected for export manufacturers in Korea, and binominal logistic regression analysis was used to analyze the type of payment method the exporter chooses for trade transactions. Findings - The likelihood of choosing advance remittance increased as the exporters had non-recovery experiences with payments, and decreased as the market power of importers increased. The possibility of post remittance increased when the export amount was large and the character of the buyer was reliable. In the case of linked remittance, it was highly likely to be selected when payment efficiency was important in trade settlement. In addition, when competition among companies in the global market is intense and market uncertainty is high, the possibility of using a letter of credit decreases. It was also found that the greater the export amount, the greater the possibility of choosing advance remittance, and even if the transaction period was longer, exporters using a letter of credit continued to use it. Originality/value - Despite the high proportion of remittances in international trade settlements, it has been hard to find studies that reflect the practical characteristics of remittances. This study classified the types of remittance into advance remittance, post remittance, and linked remittance, and built a trade payment prediction model by adding a letter of credit and mixed payment. In addition, the originality of this study is recognized in that a logistic model was constructed and meaningful results were derived.

Productivity and Patterns of Trade: The Experience of Korea in the 1990s (생산성과 무역패턴: 1990년대의 한국경제의 경험)

  • Tcha, MoonJoong
    • KDI Journal of Economic Policy
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    • v.26 no.2
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    • pp.249-280
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    • 2004
  • This paper analyzes the industrial growth of Korea in the 1990s and its relationship with the nation's export performance. The result shows that total factor productivity (TFP) played a significant role in the growth of some industries, where in particular a sharp increase in TFP was observed in the electrics and electronics industry and the automobile industry in the late 1990s. While CEPII RCA indexes for the Korean industries such as IT industry and automobile industry significantly increased since 1998, only limited evidence was found that TFP or TFI influenced RCA. Investigating Korea's export performance in the Northeast Asian context, this paper shows that, in the 1990s, the growth of Korea's exports to Japan was led by industries that recorded relatively fast growth in total factor input (TFI). In contrast, that to China was almost equally contributed by industries that experienced relatively fast growth in TFP or TFI. This paper also investigates competition between Korea and China, and Korea and Japan in the world market. The competition between Korea and China was relatively stronger for the Korean industries to whose growth TFI made a more significant contribution. While no decisive evidence is found for the relationship between TFP growth in Korean industries and their competition against Japan in the world market, it is revealed that the competition between Korea and Japan became less intense for the Korean industries to whose growth TFI made a stronger contribution. In this regard, the paper supports the view of 'nut-cracking' that the Korean economy has lost its competitiveness in the sectors where it maintained comparative advantage, but failed to catch up more advanced countries such as Japan by gaining competitiveness in more capital or technology intensive sectors.

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Assessing the Competitiveness and Complementarity of the Agricultural Products Trade between Korea and CPTPP Countries

  • Meng-wen Chen;Suk-jae Park;Quan-zheng Zhu
    • Journal of Korea Trade
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    • v.27 no.3
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    • pp.147-160
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    • 2023
  • Purpose - This paper aims to investigate the competitiveness and complementarity of the agricultural products trade between Korea and Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) countries. The study evaluates the opportunities and challenges that Korea's agricultural sector faces after joining the CPTPP, and suggests strategies to deepen cooperation and expand Korea's agricultural products trade. Design/methodology - To achieve these objectives, we analyze the trade competition and cooperation relationship between Korea and CPTPP countries in the agricultural products trade. This study uses data from Chapters HS1-24 in UN Comtrade from 2012 to 2022, and applies the indices of revealed comparative advantage, export similarity, and trade complementarity to examine the trade dynamics. Furthermore, we use an Autoregressive Integrated Moving Average (ARIMA) model to predict the agricultural products trade complementarity index between Korea and CPTPP countries from 2022 to 2031. Findings - The findings of our analysis reveal that Korea's agricultural products trade competitiveness is weak compared to that of CPTPP countries, and Korea's agricultural products are at a competitive disadvantage. On the whole, the similarity index of agricultural products trade exports between Korea and CPTPP countries is low, the structure of agricultural products export is quite different, and trade competition is relatively moderate. The trade complementarity index between Korea and CPTPP countries is generally high, with strong complementarity and a large space for cooperation and development. The ARIMA model shows that in the next ten years, although the agricultural products trade complementarity index fluctuates, but is generally high, there will still be a complementarity advantage in the future. Originality/value - This study is the first attempt to investigate the competitiveness and complementarity of the agricultural products trade between Korea and CPTPP countries. We also introduce an ARIMA model to forecast and analyze the future agricultural products trade complementarity index. Our study provides new perspectives and solutions for the future development of Korea's agricultural products trade after joining the CPTPP.

A Study on the Determinants of Export Diversification and Adoption of Competitive Advantage Strategy Using Hierarchical Analysis - A case of Automotive Parts enterprises (계층분석기법(AHP)을 이용한 수출다변화의 결정요인과 경쟁우위 전략 채택에 관한 연구 - 자동차부품 기업 사례)

  • jang, Ik-geun;Kim, Byung-Keun
    • Journal of the Korea Academia-Industrial cooperation Society
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    • v.19 no.9
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    • pp.435-445
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    • 2018
  • This study analyzed factors that should be considered in the process of export diversification strategy formulation and priorities of strategies. We reviewed the extant literature and interviewed six experts. Cross-sectional analysis of a literature review and interview results were used to determine the influencing factors of export. The data for this study were collected from a survey of 68 export experts in Automotive Parts enterprises. Data were analyzed using AHP. As a result of the analysis, the order of importance appeared in the order of internal capacity, correlation buyer effect, entry barriers, technology response, and competition environment. The regions with a high overseas level were product differentiation, centralization, and low cost, whereas those with a low level were in the order of low cost, product differentiation, and concentration. It is meaningful to review the alternatives for adoption of the export diversification strategy and establish a strategy appropriate to the situation. It is necessary to establish a customized strategy considering the characteristics of the global region, and not only internal competence but also mutual relationship with local buyers are important.

The EU-Korea FTA in the Viewpoints of the New Member States (신 회원국의 관점에서의 한-EU 자유무역협정)

  • Utai, Uprasen
    • International Area Studies Review
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    • v.15 no.1
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    • pp.3-30
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    • 2011
  • When the European Union countries (EU27) are viewed as the composition between the old member countries (EU15) and the new member states (NMS12), the statistics exhibit that the EU15 is the largest trade partner of the NMS12. According to the Korea-EU FTA agreement, the existing patterns of trade among the EU15, the NMS12, and Korea may create not only the increase in trade opportunity between the NMS12 and Korea, but also the higher rivalry threat on export from the NMS12 to the EU15 destination due to the potential increase in export from Korea to the EU15 market. This research examines in both potential impacts at the 3-digit level of SITC Rev.3 industry, in the point of view of the NMS12. Various conventional trade indices are employed in the study. However, the existing trade index exhibits the limitation for measuring the different degree of rivalry threat on exports of two different exporters in the same export destination. Hence, this study develops a new trade index, the so-called Rivalry Threat Index (RTI), to measure the export competition between the NMS12 and Korea in the EU15 destination. The results indicate that from the point of view of the NMS12, the EU-Korea FTA agreement may cause Korea acts as a trade partner and as an export competitor simultaneously.

International Success the Second Time Around: A Case Study (제이륜국제성공(第二轮国际成功): 일개안례연구(一个案例研究))

  • Colley, Mary Catherine;Gatlin, Brandie
    • Journal of Global Scholars of Marketing Science
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    • v.20 no.2
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    • pp.173-178
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    • 2010
  • A privately held, third generation family owned company, Boom Technologies, Inc. (BTI), a provider of products and services to the electric utility, telecommunications and contractor markets, continues to make progress in exporting. Although export sales only equaled 5% of total revenue in 2008, BTI has an entire export division. Their export division's Managing Director reveals the trial and errors of a privately held company and their quest for success overseas. From its inception, BTI has always believed its greatest asset is its employees. When export sales struggled due to lack of strategy and direction, BTI hired a Managing Director for its export division. With leadership and guidance from BTI's president and from the Managing Director, they utilized the department's skills and knowledge. Structural changes were made to expand their market presence abroad and increase export sales. As a result, export sales increased four-fold, area managers in new countries were added and distribution networks were successfully cultivated. At times, revenue generation was difficult to determine due to the structure of the company. Therefore, in 1996, the export division was restructured as a limited liability company. This allowed the company to improve the tracking of revenue and expenses. Originally, 80% of BTI's export sales came from two countries; therefore, the initial approach to selling overseas was not reaching their anticipated goals of expanding their foreign market presence. However, changes were made and now the company manages the details of selling to over 80 countries. There were three major export expansion challenges noted by the Managing Director: 1. Product and Shipping - The major obstacle for BTI was product assembly. Originally, the majority of the product was assembled in the United States, which increased shipping and packaging costs. With so many parts specified in the order, many times the order would arrive with parts missing. The missing parts could equate to tens of thousands of dollars. Shipping these missing parts separately in another shipment also cost tens of thousands of dollar, plus a delivery delay time of six to eight weeks; all of which came out of the BTI's pockets. 2. Product Adaptation - Safety and product standards varied widely for each of the 80 countries to which BTI exported. Weights, special licenses, product specification requirements, measurement systems, and truck stability can all differ from country to country and can serve as a type of barrier to entry, making it difficult to adapt products accordingly. Technical and safety standards are barriers that serve as a type of protection for the local industry and can stand in the way of successfully pursuing foreign markets. 3. Marketing Challenges - The importance of distribution creates many challenges for BTI as they attempt to determine how each country prefers to operate with regard to their distribution systems. Some countries have competition from a small competitor that only produces one competing product; whereas BTI manufactures over 100 products. Marketing material is another concern for BTI as they attempt to push marketing costs to the distributors. Adapting the marketing material can be costly in terms of translation and cultural differences. In addition, the size of paper in the United States differs from those in some countries, causing many problems when attempting to copy the same layout and With distribution being one of several challenges for BTI, the company claims their distribution network is one of their competitive advantages, as the location and names of their distributors are not revealed. In addition, BTI rotates two offerings yearly: training to their distributors one year and then the next is a distributor's meeting. With a focus on product and shipping, product adaptation, and marketing challenges, the intricacies of selling overseas takes time and patience. Another competitive advantage noted is BTI's cradle to grave strategy, where they follow the product from sale to its final resting place, whether the truck is leased or purchased new or used. They also offer service and maintenance plans with a detailed cost analysis provided to the company prior to purchasing or leasing the product. Expanding abroad will always create challenges for a company. As the Managing Director stated, "If you don't have patience (in the export business), you better do something else." Knowing how to adapt quickly provides BTI with the skills necessary to adjust to the changing needs of each country and its own unique challenges, allowing them to remain competitive.

Survey on Strategies for Developing the Mongolian Cashmere Industry (몽골 캐시미어 산업 발전방안 모색을 위한 현장 근무자 조사)

  • Yu, Haekyung;Ko, Sunyoung
    • Journal of the Korean Society of Costume
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    • v.64 no.2
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    • pp.84-97
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    • 2014
  • This research aimed to explore strategies to develop the cashmere industry in Mongolia. Questionnaire consisted of questions regarding the necessity of development in different sectors in the cashmere industry, and areas of necessary competition for the development of Mongolian cashmere industry. In addition, characteristics of respondents and their companies were questioned. Surveys were distributed to people working in cashmere manufacturing companies in Ulaanbaator, Mongolia between July 25th, 2012 to September 3rd, 2012, and a total of 79 questionnaires were included in the final analysis using descriptive analysis, t-test, one-way ANOVA, and Duncan test. Results showed that respondents perceived design as the sector that needed the most improvement, and product related strategies such as product quality, product differentiation, and design were more important than distribution or promotion related strategies. The perceptions on the development strategies differed according to company size and their target markets (domestic vs. export). Overall, respondents working in smaller companies showed greater concern for most sectors, and also felt technology, product quality and design were more important than those in working in larger companies. Companies that targeted the domestic market showed greater concern for herding and scouring sector than companies that exported, while the latter evaluated government policy, network, distribution/export channels more importantly than the former in developing the Mongolian cashmere industry.

Trade Structural Analysis of the Steel Distribution Industry between Japan and USA

  • Noh, Hyun-Soo;Kim, Yung-Keun;Lee, Jae-Sung
    • Journal of Distribution Science
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    • v.12 no.11
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    • pp.35-43
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    • 2014
  • Purpose - This study evaluates the mutual influential power regarding the trade volumes of Japan and USA, based on a literature review and an empirical analysis. Through the literature review, I could evaluate each country's actual import-export volume and its status. Further, I could evaluate how each country could influence its trade outcome, through empirical analysis. Research design, data, and methodology - This study aims to review the trade structure to improve Japan-USA economic and social cooperation, as the two countries have reciprocal complementary features, and to examine trade weaknesses and analyze factors influencing trade and its direction, as well as to identify ways to expand trade. Results - The intra-economic potential cooperation fields are numerous. Additionally, anticipated profits from these fields are stable as compared to other fields in the regional economic integration. Conclusion - The interrelations between the two economic identities can provide optimal opportunities for industrial technology cooperation. Under the current aggravated competition in industrial fields, it is advisable to identify ways to secure stable resource suppliers, including the development of export markets.

Competitiveness in Exports of Pharmaceuticals to Developed Countries: A Comparative Policy Analysis on South Korea and India (선진국으로의 의약품 수출 경쟁력: 한국과 인도를 대상으로 한 정책비교분석 연구)

  • Yun, Su-Jin;Cho, Eun
    • YAKHAK HOEJI
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    • v.56 no.2
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    • pp.116-125
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    • 2012
  • Local pharmaceutical companies in Korea, which have grown focusing on domestic markets, have recently faced difficulties such as market saturation, price control policies and market-opening pressures by FTA. It seems to be an urgent issue for them to export pharmaceuticals to developed countries comprising the greater part of the global pharmaceutical market. Hence, this research was conducted to investigate and benchmark the strategies employed by India industry for the successful access to the global pharmaceutical markets. Drug policies as well as their influences on pharmaceutical market changes between India and Korea for the last 40 years have been searched and the differences have been comparatively analyzed. The pharmaceutical industry of India has the following strengths: low costs; experienced labor pool; excellent reverse-engineering skills; powerful IT; marketing capability; and established distribution network. After 2000, consolidations, M&A and alliances with domestic and multinational companies have been sharply increased in the industry of India. Indian companies unfolding both competition and cooperation with multinational corporations currently move up the value-added chain, and this enthusiastic strategy should be learned by local pharmaceutical companies.

A Study for risk management on Documentary Collection(D/P, D/A) Payment (추심결제(D/P, D/A)방식에서의 위험관리에 관한 연구)

  • Kwak, Su-Young
    • International Commerce and Information Review
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    • v.10 no.2
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    • pp.283-304
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    • 2008
  • According to globalization and localization of world economics international trade payment method was also changed. A traditional payment was Letter of Credit basis, however it is being increased to various methods such as remittance, documentary collection(D/P, D/A) and open account. In order to acquire a secure export payment, exporters prefer to L/C basis which is guaranteed by a reliable bank. However, the L/C should bear a security so that importers would rather documentary collection than L/C. The reasons for the preference of collection payment rather than L/C are a low commission cost, the conversion of buyer's market from seller's market due to severe competition in the world market, transaction increase between main office and branches and a right to control the goods until executing the payment by exporters. Besides of them, collection payment can handle safer and faster than open account basis. However, the collection payment has a risk which it isn't guaranteed by bank for the payment so that I would suggest countermeasures to minimize the payment risk utilizing the collection basis as follows; using export credit insurance system, a large domestic credit report provider such as D&B for absolutely fresh and new information, a collection proxy service for overseas deferred credit and suggestion specifying to order B/L not straight one on consignee in order to transfer the right of ownership with endorsement without problem.

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