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Barriers to trade in the second era of globalisation : Empirical evidence from Korea

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  • Barriers to trade in the second era of globalisation
  • De, Prabir; Lee, Soon Cheul
  • The Association of Korean Economic Studies


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Title Barriers to trade in the second era of globalisation
Similar Titles
Sub Title

Empirical evidence from Korea

Material Type Articles
Author(English)

De, Prabir; Lee, Soon Cheul

Publisher

[Seoul]:The Association of Korean Economic Studies

Date 2009-08
Journal Title; Vol./Issue The Journal of the Korean Economy:vol. 10(no. 2)
Pages 26
Subject Country China(Asia and Pacific)
South Korea(Asia and Pacific)
Language English
File Type Link
Subject Economy < Trade
Economy < Economic Administration
Holding AKES

Abstract

Korea has been witnessing a sharp rise in merchandise trade and showing greater trade interdependence on a large variety of goods. At the same time, rising transportation costs continue to impede Korea‘s merchandise trade. This paper provides sufficient evidence to ascertain that variations in ad-valorem transportation costs strongly influence trade flows in Korea. The analysis carried out in this paper indicates that a 10% fall in ad-valorem transportation cost would likely to increase Korea‘s trade by 12%. One of the conclusions of this paper is that transportation cost is relatively more important than tariff in enhancing Korea‘s trade. Reduction in transportation costs should therefore get utmost priority while formulating policy for Korea‘s infrastructure development and trade facilitation since the fall in transportation costs, as an outcome of improved infrastructure and trade facilitation, will stimulate trade.