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The impact of trade costs on firm entry, exporting, and survival in Korea

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  • The impact of trade costs on firm entry, exporting, and survival in Korea
  • Kim, Sooil; Reimer, Jeffrey J.; Gopinath, Munisamy
  • Western Economic Association International


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Title The impact of trade costs on firm entry, exporting, and survival in Korea
Similar Titles
Material Type Reports
Author(English)

Kim, Sooil; Reimer, Jeffrey J.; Gopinath, Munisamy

Publisher

[Fountain Valley]:Western Economic Association International

Date 2011-04
Journal Title; Vol./Issue Economic Inquiry:Vol. 49(No. 2)
Subject Country South Korea(Asia and Pacific)
Language English
File Type Link
Subject Economy < Trade
Economy < Economic Administration
Social Development < Employment
Holding COnnecting REpositories

Abstract

This study uses a unique firm-level data set to examine how falling trade costs from 1993-2001 affected entry, exit, productivity, and exporting in the Korean manufacturing sector. We verify many of the predictions of recent heterogeneous-firm models of international trade. For example, falling trade costs reduced entry by new Korean firms, increased their probability of exit, and reduced the market share of surviving firms. We also find that small firms had a particularly high level of dynamism over the sample period. Small firms were more likely to enter and exit, and marginally more likely to gain market share, enter export markets for the first time, and improve their productivity.

User Note

Selected Paper prepared for presentation at the Agricultural & Applied Economics Association 2009 AAEA & ACCI Joint Annual Meeting, Milwaukee, Wisconsin, July 26-29, 2009