• Korea Trade Review
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• v.41 no.3
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• pp.1-25
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• 2016

This study reviews international discussions about the trade-labor linkage and examines the labor chapters of FTAs enforced by the US and the EU from a comparative perspective. Since early 1990s, starting from the NAFTA, the US has included forceable labor provisions in its FTAs and this trend continues to the TPP which was concluded in October 2015. On the other hand, the EU's labor provisions in its FTAs have been composed of promotional elements on labor rights based on cooperations and dialogues. These different features of labor provisions in the US and European FTAs are mainly due to the motives of the FTAs of the US and the EU respectively as well as their domestic situations with regards to domestic law and institutional set-ups. The coordination of labor provisions involves a long-term institutional as well as regulatory convergence which triggers not only economic but also social changes, compared to a relatively short-term effect of tariff elimination. For Korea which has been a FTA partner country both with the US and the EU, it is significant to keep the different characteristics in the labor provisions in mind, particularly in the process of its implementation. Concerning the implementation of Korea-US FTA, it might be problematic if Korean law and its regulatory practice on labor-management relations do not comply with that of the US. The Korea-EU FTA case can also have an indirect impact on Korea's labor laws since it stipulates in its provisions that both parties should have discussions not only within each government but also with the civil communities including NGOs. Thus, Korea should pay more attention to the true meaning in labor provisions of both FTAs in order to promote its firms to be equipped with the right labor-management system in their operations abroad.

• Korea Trade Review
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• v.45 no.4
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• pp.171-194
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• 2020

Although there is a lot of literature on the effectiveness of regional trade agreements(RTAs), it is usually analyzed only using trade-related theories and data. However, this paper has a differentiation in that we examine the linkage between international trade and financial markets through the stock markets reactions when the trade agreements related news arrived. Specifically, using an event study, we look into the Korea-US free trade agreement(KORUS FTA) which is the most commercially significant FTA in almost two decades for both the countries. Korean stock market generally responded more sensitively to FTA news than the US stock market, especially in 'Auto & Parts', 'Electrical Equipment' and 'Chemicals' industries. And the investors' perception toward the effect of KORUS FTA on Korean industries changed from negative to positive as negotiations proceed. Korea has a comparative advantage in the production of labor-intensive goods relative to US, but the economies of scale hypothesis does not hold.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.3
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• pp.1217-1230
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• 2021

Using a multinomial logit model with the panel-data set of Vietnam manufacturing firms, this paper investigates the impacts of foreign direct investment (FDI) - small and medium enterprises (SMEs) linkages and other factors on SMEs' participation in the global value chain (GVC). We consider GVC firms are those engaging in any of the three modes including (i) using domestic inputs to export (D2E), (ii) using imported inputs to produce for the domestic market (I2P), (iii) using imported inputs to export (I2E). We discover that FDI-SME linkages statistically encourage Vietnamese SMEs to integrate into the GVC via I2P and I2E, while no statistical association between FDI-SME linkage and D2E participation is found. GVCs participation likelihood is also positively correlated with the introduction of new product introduction. The establishment of firms' production facilities in industrial zones and foreign ownership are both reported to be significantly decisive factors to SMEs' decisions on GVC participation. Besides, there is a strong association between firms' attributes, i.e. employment, capital intensity as well as financial access, and their participation in the GVC. Local governance quality (proxied by the Provincial Competitiveness Index) and the share of skilled labor at the province-level can facilitate firms' integration into GVCs, while greater market concentration may be a hurdle to such potential.