• Journal of Korea Trade
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• v.23 no.2
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• pp.88-109
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• 2019

Purpose - This paper examines the effects of host country's non-economic factors on foreign affiliate's financial and operational performance. Design/Methodology - Using Korean-owned foreign affiliate-level data, we employ various measures that represent host country's non-economic factors and examine their effects on foreign affiliate's performance. We further investigate the effects of local top managers and local middle managers on the impact of country's non-economic factors on foreign affiliate's performance. Findings - We find that local top managers are effective in increasing foreign affiliate's financial performance by dealing with institutional and cultural factors, particularly in high-income countries, while local middle managers are effective in increasing affiliate's operational performance by responding to the changes in doing business factors, particularly in low-income countries. Originality/value - Considering that most of previous FDI studies focus on examining host country's economic factors on firm's FDI decision, our findings suggest that country's non-economic factors are strongly associated with actual business performance of foreign affiliates.

• Korea Trade Review
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• v.45 no.4
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• pp.195-205
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• 2020

This study investigates the effects of financial development on the foreign direct investment (FDI) flow in host countries. Using bilateral FDI data from 34 OECD source countries to 146 host countries, we performed panel data analysis based on a gravity FDI equation. We hypothesized that the financial development would increase the volume of FDI flows. The results suggest that the well-functioning finance market of source countries as well as a better accessable financial market of host countries contribute to the increase in FDI of OECD in their partner countries. We found also that the financial development effects of source countries are larger than those of host countries. This result shows that the financial development can play a crucial role to impact the FDI inflows as push factor in source country than as a pull factor in host countries.

• THE INTERNATIONAL COMMERCE & LAW REVIEW
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• v.43
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• pp.397-422
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• 2009

Electronic trade reduces additional costs generated from the issuing and management of paper documents, and overcomes the physical limitations of commercial transactions as well as the geographical and time limitations resulting from trading with foreign countries. These characteristics of electronic trade guarantees better and more effective global marketing for companies. In addition, by expanding relative superiority of large corporations to medium-small sized companies, many medium-small companies have shown great interest in electronic trade to promote its exporting businesses, and implementing changes to facilitate electronic trade into their business system. Therefore, it is expected that the electronic trade will be more widely distributed and utilized by businesses of all sizes in the future. The adaptation and implementation of the electronic trade system can only have prosperous effects when there is a high efficiency in the utilization and service process of the concerned company. Under this premise, this research first examined electronic trade, characteristics of the company and information utilization as the key elements to determine the effectiveness of the utility aspect. Then it examines confirmation of product demand, registration of revenues, and authorization as the key elements to determine the level of service process.

• Journal of Arbitration Studies
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• v.26 no.2
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• pp.91-114
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• 2016

The purpose of this study is to promote trade between Korea and South American countries. Korea's trade with South America has decreased recently. This study analyzed the effects of arbitration on trade between Korea and South America. To this end, we conducted an analysis of the gravity model of trade between Korea and South America. The gravity model is a research method that is widely used to analyze the pattern of international trade. The dependent variables of the gravity model were trade in Korea and South America. The independent variables were GDP, population, and distance between Korea and South America. In addition, dummy variables were the FTA and whether to join the New York Convention or Washington Convention. Joining either Convention indicated the establishment of an international arbitration system. As a result, an arbitration system appeared to be effective in increasing trade. Depending on the results it shows the importance of utilizing the system of arbitration in South America. So this study analyzed the current status of arbitration in South America. To companies doing business in South America it provided the implications for an arbitration system there. Also it proposed a method for increasing trade for the Korean government and institutions.

• Asian Journal of Business Environment
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• v.3 no.2
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• pp.17-22
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• 2013

Purpose - This dissertation is based on previous research, and analyzes processing trade, which constitutes a major section of foreign trade in Shandong Province. Research design, data, and methodology - The study uses the survey data on polarization, which is a vital index reflecting the unbalanced growth of regional economic development. The article introduces the processing trade polarization index, and the processing trade polarization fluctuation rate, to predict the geographical polarization posture and development trends in Shandong Province. Results -The development of processing trade in Shandong Province shows the level of gradient from east to west. The first-line growth pole has been formed and developed, and the initial formation of the diffusion mechanism has taken place. However, coordination problems in accompanying regional development have become increasingly prominent. Conclusions - This study focuses on the development of processing trade strategy and suggests overall coordination of development objectives, using non-balanced development goals. According to regional characteristics and development objectives of the processing trade in Shandong Province, the region around the city is divided into innovation diffusion region, enhanced growth areas, areas expected to undertake development, and areas to upgrade in four levels, given the different policy proposals.

• Journal of Korea Trade
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• v.25 no.6
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• pp.126-142
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• 2021

Purpose - This study discusses the effects of human capital in the formation of GVC linkages. We also investigate GVC intensity between Korea and ASEAN. Design/methodology - To solve the doubling-counting problem in evaluating comparative advantage, RCA has been re-computed using domestic value-added (henceforth RCA_VA) at the country-sector level instead of value of trade. The impact of human capital on GVC intensity was empirically analyzed by establishing a panel data set with four industries (ISIC Rev. 4) in eight ASEAN countries from 2005 to 2015 from OECD-TiVA and WDI. Findings - The empirical results show that human capital has a negative effect on GVC intensity in the agriculture and manufacture industries, while it has a positive effect in the service and information industries. The results do not mean that low human capital is a barrier and inefficient to GVC linkages. Low Value-added activities may be more profitable to some emerging countries. These findings suggest that it is important to accurately identify the competitive elements to increase gains from trade under the GVC. Also, it shows that comparative advantages can be misled by an RCA index evaluated in trade volume under the GVC. Originality/value - This study highlights the importance of human capital as a factor for the efficient formation of Global Value Chain (GVC). This study has different from the literature in analyzing the role of human capital in formation of linkage of the GVC. And we clarify the changing patterns of trade by removing the double-counting problem under the GVC.

• Korea Trade Review
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• v.44 no.6
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• pp.217-230
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• 2019

This study investigates the impacts of international trade and foreign direct investment (FDI) on income distribution both nationally as well as provincially in Vietnam. This study uses panel data of 63 provinces in Vietnam for the period of 2008-2016 and a time series dataset from 1992 to 2016. We found the following results. First, the income distribution is significantly affected by per capita income. When we consider the Kuznets hypothesis, the intra-provincial income inequality of Vietnam's 63 provinces follows a regular U-shaped relationship. In contrast, the income distribution in Vietnam exhibits an inverted U-shaped relationship between the Gini coefficient and per capita income. Second, the inward FDI tends to reduce income gaps in each province through the employment of predominantly low-skilled workers. FDI, however, seems to increase income inequality throughout Vietnam. This result is potentially due to the strong concentration of FDI into a very few areas. Third, the effect of trade openness exhibits a decrease in inequality both within each province and in the whole country of Vietnam.

• Journal of Korea Trade
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• v.24 no.1
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• pp.35-58
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• 2020

Purpose - This study examines the determinants of foreign direct investment (FDI) location choice for Chinese firms, focusing on the agglomeration effect for firms of the same nationality. Design/methodology - The empirical data are China's inward FDI from the top 19 economies (excluding tax havens and Taiwan) in terms of FDI during 1997-2015 and China's outward FDI from the top 18 economies (excluding tax havens). This study uses a random effects generalized least squares model for panel data analysis. Findings - The results confirm that both host countries' costs and market conditions and the degree of agglomeration affect these countries' attractiveness for FDI inflows. Specifically, agglomeration has a significant effect on China's inward and outward FDI. This study confirms that the agglomeration of firms of the same nationality has predictive power for multinational enterprises' FDI location choices. The host countries' real GDP and trade openness also positively affect FDI inflows. Interestingly, however, China's production cost has a positive effect. Thus, inward FDI aimed at entering the Chinese market is increasing in recent years relative to the previous efficiency-seeking FDI. Inward FDI in China is therefore the market-entry type, whereas outward FDI by Chinese firms is the market-oriented type. Originality/value - These results suggest that the effects of the potential determinants of Chinese outward FDI are similar to those of inward FDI as China's trade liberalization progresses.

• Korea Trade Review
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• v.44 no.3
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• pp.203-226
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• 2019

This study incorporates the structural relationships between leadership styles (LS), affect climate (AC), and organizational performance (OP) in Korean export manufacturing companies with three or more overseas subsidiaries. A theoretical model is suggested with the following empirical results. First, the positive effect of engaging leadership (EL) on organizational citizenship behavior (OCB), as well as of engaging leadership, involving leadership (IL), and goal-oriented leadership (GL) on team performance (TP), proved to be significant. Second, both engaging leadership and goal-oriented leadership have significant positive effects on optimism, while involving leadership has significant negative effects on pessimism. Third, only optimism has a positive (+) effect on OCB and TP. The mediating effects were proved to be significant in two paths: one in EL->optimism->OCB and the other in EL->optimism->TP. Finally, in responding to rapid changes in the external environment of exporting companies, the engaging leadership is a key source of organizational performance by forming a favorable affect climate. Therefore, top management should recognize the role of team leaders and strengthen their leadership training. In addition, it was confirmed that leaders with emotional intelligence that can respond to the affects of members play a more important role in forming an optimistic climate in Korea export manufacturing enterprises with foreign subsidiaries.

• Journal of Korea Trade
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• v.23 no.8
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• pp.73-88
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• 2019

Purpose - This paper finds the repurchase intentions of customers in a sharing economy via Airbnb and Uber, which are classic sharing-economy service businesses. Design/methodology - This paper analyzes sharing economy effects using variables in a structural equation model. Findings - We verified that values have a significant effect on the trust in a platform. We also verified that the effects that value propositions have on repurchase intention are significant. Research Limitations/Implications - First, there may be some distinction between men and women with regard to divided trust. Second, if commitment is divided into commitment to the host and commitment to the platform, as is the case for trust, the results will not be as expected. Third, if results could be categorized by nationality after gathering more samples, each nationality might have different opinions about these factors. Finally, the sharing economy can be identified and analyzed for various industries, such as space, transportation, and service. At this point, it is inconvenient to not have more implications. Originality/value - This study focuses on the repurchase intentions of customers. Unlike earlier studies, it is meaningful that trust is divided between the host and the platform, and that it can be analyzed. It is also important to establish the relationship between trust and commitment, and the relationship toward repurchasing in the shared-economy.