• Journal of Distribution Science
• /
• v.13 no.8
• /
• pp.5-14
• /
• 2015

Purpose - This study undertakes to examine the automotive trade structure between Korea and Russia to accelerate economic cooperation and pinpoint trade discrepancies to increase trade volume through improved policies, eventually finding ways for trade expansion. Research design, data, and methodology - To analyze trade decision factors for both countries, the Index of trade specialization invented by trade specialization theory, is used. Although specific factors should materialize in the trade decision analysis, realistically, concrete explanations are difficult as many unsolved factors are involved as well as their complexities Results - First, to assess comparative market competitiveness, the Index describes A value/B value, representing the Korean versus the Russia market share and the Korean market share versus the world. Second, the index shows that Korea is taking comparative advantage of its export specialization. Third, the RCA indices show considerable improvement compared to 2000. Conclusions - This research used a quantitative approach to examine trade specialization and examined a comparative advantage index of market share to see how inter-trade relations have changed over the past 10 years.

• Asia-Pacific Journal of Business
• /
• v.14 no.1
• /
• pp.341-350
• /
• 2023

Purpose - How are gains from trade distributed between countries when economic integration is achieved through free trade? The purpose of this paper is to answer this question. Design/methodology/approach - This study attempts to address the issue of distribution of trade gains between participating countries following economic integration in terms of positive economics. The analysis is therefore based on a theoretical methodology. Findings - First, commodity prices fall and consumer surplus increases in both large and small countries. Second, when economic integration into free trade is achieved, gains from trade always exist in small countries. However, the size of trade gains depends on the degree of difference from the market size of the partner country, the large country. However, the size of the gains from trade depends on the extent of difference between the market size of the large country. If the market size of a large country is much larger and there is a large difference, trade gains will be very large, whereas if the market size is similar, profits of domestic firm will decrease. Therefore, in that case, the size of the gains from trade becomes relatively small because only the gains from exchange exists. On the other hand, in a large country with a large market size, there is a possibility of trade gains only when the market size is similar to that of a small country, which is a trading partner. However, if there is a large difference in market size, the decrease in profits of domestic firm is relatively larger than the increase in consumer surplus due to trade, and rather, a trade loss occurs. Research implications or Originality - Our analysis contributes to filling the gaps in the literature regarding the distribution of gains from trade, and from a policy point of view, it is meaningful in examining the impact of market size, an important variable considered in regional economic integration of countries.

• Journal of Korea Trade
• /
• v.27 no.1
• /
• pp.139-158
• /
• 2023

Purpose - The study of co-movements between stock markets is a crucial area of finance and has recently received much interest in a variety of studies, especially in international finance. Stock market co-movements are a major phenomenon in financial markets, but they are not necessarily independent of the real market. Several studies support the idea that bilateral trade linkages significantly impact stock market correlations. Motivated by this perspective, this study investigates whether real market integration due to trade agreements brings about financial market integration in terms of stock market co-movement. Design/methodology - Over the 10 free trade agreements (FTAs) signed by the United States, using a dynamic conditional correlations (DCC) multivariate GARCH (MGRACH) model, we empirically measure the degree of integration by finding DCCs between the US market and the partner country's market. We then track how these correlations evolve over time and compare the results before and after trade agreements. Findings - According to the empirical results, there are positive return spillover effects from the US market to eight counterpart equity markets, except Jordan, Morocco, and Singapore. Especially Mexico, Canada, and Chile have large return spillover effects at the 1% significance level. All partner countries of FTAs generally have positive correlations with the US over the entire period, but the size and variance are somewhat different by country. Meanwhile, not all countries that signed trade agreements with the United States showed the same pattern of stock market co-movement after the agreement. Korea, Mexico, Chile, Colombia, Peru, and Singapore show increasing DCC patterns after trade agreements with the US. However, Canada, Australia, Bahrain, Jordan, and Morocco do not show different patterns before and after trade agreements in DCCs. These countries generally have the characteristic of relatively lower or higher co-movements in stock markets with the US before the signing of the FTAs. Originality/value - To our knowledge, few studies have directly examined the linkages between trade agreements and stock markets. Our approach is novel as it considers the problem of conditional heteroscedasticity and visualizes the change of correlations with time variations. Moreover, analyzing several trade agreements based on the United States enables the results of cross-country pairs to be compared. Hence, this study provides information on the degree of stock market integration with countries with which the United States has trade agreements, while simultaneously allowing us to track whether there have been changes in stock market integration patterns before and after trade agreements.

• Korea Trade Review
• /
• v.47 no.6
• /
• pp.247-267
• /
• 2022

Since the Korea-Vietnam FTA was signed in 2015, trade between the two countries has increased rapidly, accounting for 6.8% of Vietnam's exports and 17.9% of its imports in 2020. The two countries show differences in import and export items. Vietnam has a high export ratio of agri-food products or products with the low-middle level of technology, while Korea has a high export ratio of products with the upper-middle level. The purpose of this study is to present implications by analyzing changes in trade competitiveness between Vietnam and Korea by technology level (2002-2020). For this purpose, statistics from UN Comtrade were used, and methodologies such as market share, Export Market Share (EMS), Trade Specialization Index (TSI), Intra-Industrial Trade Index (IIT), Revealed Comparative Advantage (RCA), and BCG Matrix were used. The results of the study are as follows. First, when looking at Vietnam's trade structure with South Korea by technology level, it was analyzed that the trade deficit widened as it showed a competitive disadvantage in high-tech, ICT, middle- and low-level technology items, excluding low-end technology items. Second, in terms of market share, the market share of Vietnamese products in the Korean market is continuously increasing, while the Korean market share in Vietnam is gradually decreasing from 2017. Third, Vietnam's export competitiveness to Korea by technology level shows that low-level technologies are competitive, but they are inferior in competitiveness in all other technology level, and especially in areas with high technology level, the level of inferiority is high. In conclusion, the trade relationship between Vietnam and Korea has maintained a mutually complementary rather than competitive relationship, which is expected to continue in the future.

• International Commerce and Information Review
• /
• v.12 no.4
• /
• pp.327-344
• /
• 2010

This study intends to analyze the trade competitiveness of Korean films in international markets. Under environmental of film industry, Korean films could be doing better. But the Key success factors Korean films in the foreign markets are the improvement of contents Quality and the diversification of trade market. Namely, Our films is mainly exporting Japanese market and the import depends upon American films. In case the trade specialization index(TSI), The international competitiveness of Korean films shows lower import specialization, by virtue of export increasing of Japan, Europe and other markets in 2000's. On the other hand, The Export Market Share has shown similar pattern to main markets except Japanese market, and the import was almost similar to trend in foreign markets except American films. Consequently the present film strategies and polices that delight limited markets will not be compete in global markets, Korean films or contents is merely called by that name.

• The Journal of Asian Finance, Economics and Business
• /
• v.8 no.3
• /
• pp.127-137
• /
• 2021

Mainland China area has been a long-term, major trade rival and partner of Taiwan, accounting for more than 40% of Taiwan's total annual trade exports, and so Sino-US trade friction is expected to have a significant impact on Taiwan's economy in the future. This study focuses on major bad news of Sino-US trade frictions and how it generates short-term shocks for Taiwan's equity market and fear sentiment. It further explores the mutual interpretation relationship between price changes such as VIX, Taiwan's stock market index, and the VIX ETF to identify which factors have information leadership as leading indicators. The study period covers 750 trading days from 2017/1/3 to 2020/1/31. This study finds that, when a policy news is announced, the stock market index falls significantly, the change in the trading price (net value) of the VIX ETF rises significantly, and the overprice rate significantly drops, but VIX does not, showing that fear sentiment exists in the Taiwan's market. The net value of the VIX ETF shows an information advantage as a leading indicator. This study suggests that, when the world's two largest economies clash over trade, the impact on Taiwan's equity market is inevitable, and that short-term fear effects will arise.

• The Journal of Asian Finance, Economics and Business
• /
• v.7 no.12
• /
• pp.73-84
• /
• 2020

The study aims to investigate the dual effects of corruption control on economic growth in relationship with the stock market and trade openness in developing countries. The study used difference S-GMM method on the dynamic panel data model in the period (2002-2017) with data collected from the World Bank. The study discovers the dominant impacts of corruption control in the relationship with the stock market on economic growth. At the same time, the study also confirms the overwhelming impact of corruption control in the relationship between trade openness and economic growth in the developing countries. In addition, the study shows that inefficient stock markets in developing countries will not promote economic growth. Meanwhile, the long-standing credit market has a positive impact on economic growth. With the strong development of stock market and trade openness in the period (2002-2017), control on corruption in developing countries does not get better in time with the increase in demand. The findings of this study suggest a number of solutions to strengthen corruption control, leading to the increased efficiency on the stock market and as well as encouraging the positive effects of trade openness to contribute to promoting economic growth in developing countries.

• The Journal of Asian Finance, Economics and Business
• /
• v.8 no.3
• /
• pp.1241-1248
• /
• 2021

This study employs data from CRSP/Compustat files for the period from 2003 to 2017 and applies a panel data analysis. The results of this study show a positive relationship between trade credit and the firm's market value, however, the results show a negative relationship if we test the impact of financial credit on the firm's market value. The results have direct policy implications for investors, the firm's management, and financial strategy. An implication of our study is that using trade credit as a source of financing may give a positive signal of the firm's creditworthiness and increase the firm's market value. Also, the results of our study indicate that the benefits of using trade credit may outperform the cost of using it as a source of finance. Prior studies examine the impact of financial leverage on the firm's value, however, this study contributes to the existing studies that examine the factors that affect the firm's market value by examining the impact of using trade credit finance on the firm's market value. The main limitation of this study is that the results are based on listed firms, using data from unlisted firms is not available.

• Korea Trade Review
• /
• v.46 no.1
• /
• pp.59-81
• /
• 2021

This paper aims to analyze Korea's trade and investment performance in Spain and the business environment of Spain, and to find efficient strategies for entering into the Spanish market. This study is organized into five chapters. To begin with, it explains an overview of the Spanish economy and the current status of its major industries. Then, it analyzes Korea's trade and investment performance in Spain, the structure of comparative advantage and the trade trends of major import and export items, since 2011 when the Korea-EU FTA went into effect. Lastly, based on the results of this analysis, Korea's strategies for entering into the Spanish market are derived. The strategies derived from the analysis are as follows: (1) entering startups in the Spanish market through CVC cooperation and participation in large tech forums, (2) linking the Spanish interest in K-Culture to consumer goods exports, (3) promoting cooperation in the IT industry in response to the Spanish government's 'Connected Industry 4.0', (4) building a new Korean-Spanish value chain in response to the mobility revolution, (5) advancing jointly into a third country by combining the strengths of both Korea and Spain, (6) cooperating with the Spanish government to establish a sustainable energy policy, (7) promoting jointly with the Spanish government through smart city strategies and project exchanges, and (8) building a European logistics hub in Spain in preparation for post-Brexit.

• THE INTERNATIONAL COMMERCE & LAW REVIEW
• /
• v.77
• /
• pp.195-214
• /
• 2018

In order to analyze the current status of trade with Korea and FTA partner countries, the Trade Intensity Index and the Market Comparative Advantage index were calculated and analyzed using panel gravity model. In the case of trade, trade intensity index has been strengthened according to each FTA enforecement, and in some cases, trade inensity has been weakened. In the case of the comparative advantage index, there was a case in which the comparative advantage was strengthened or the comparative advantage was not significantly changed according to each Chapter of HS code. This means that the Korea's FTA enforcement effect has not directly affected the increase of the trade intensity and the increase of the market comparative advantage index. The panel gravity model using the trade intensity and the comparative advantage index as the dependent variable and the trade volume between the two countries as the dependent variable was analyzed.