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Factor contents of Korea net export and comparative advantage pattern

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Frame of Image ly on what it can produce relatively efficiently in relation with other countries. The concept of relative efficiency in production is that of comparative advantage. M o d e r n concepts of comparative advantage extend beyond the traditional Heckscher-Ohlin model1) for the factors of labor and physical capital as sources of comparative advantage. Since the debates on the ‘Leontief Paradox’, human capital has been considered a key determinant of a country’s specialization in international trade. Likewise, inter national specialization may depend on the characteristics of disaggregated capital rather than
capital in general. The purpose of this study is to measure the factor contents of Korean net exports with world, Japan, China, using a factor-content technique based on the HOV (Heckscher-Ohlin-Vanek) model where multiple factors exist. The measurement may help us to understand which factors Korea enjoys a comparative advantage in terms of trade with major trading partners. This study comprises four sections. The second section deals with the methodology of the analysis, focusing on the key theory and measuring technique, followed by the third section where the results are presented. The final section provides policy suggestions.
2. Methodology: Theory and Measurement
The measurement of factor endowments in this s t u d y i s b a s e d o n t h e H O V ( H e c k s c h e r -OhlinVanek) theorem.
(1) Theory 2)
Studies of factor contents of international trade
1) According to the


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Title Factor contents of Korea net export and comparative advantage pattern
Similar Titles
Material Type Reports
Author(English)

Oh, Young-Seok

Publisher

[Seoul]:Korea Institute for Industrial Economics & Trade

Date 2010
Journal Title; Vol./Issue KIET Industrial Economic Review(Current issues):vol. 15(no. 1)
Pages 9
Subject Country South Korea(Asia and Pacific)
Language English
File Type Documents
Original Format pdf
Subject Economy < Trade
Holding KDI School of Public Policy and Management

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