{
  "title": "A Reexamination of Korea’s Trade Flows: What Has Changed and What Explains These Changes?",
  "publication": "IMF Working Papers, August 1, 2004",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/30/a-reexamination-of-koreas-trade-flows-what-has-changed-and-what-explains-these-changes-17447",
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  "summary": "This paper reexamines Korea's trade flows. Using the standard demand-based models, the paper finds that owing to the increasing share of electrical and electronic products (EEPs) in total exports, the income elasticity of the Korean export demand has fallen sharply while its price elasticity has ris",
  "sections": [
    {
      "heading": "Core findings",
      "content": "- Using standard demand-based models, the paper finds that owing to the increasing share of electrical and electronic products (EEPs) in total exports:\n  - the income elasticity of the Korean export demand has fallen sharply.\n  - the price elasticity of the Korean export demand has risen dramatically.\n- An alternative supply-based model attributes the sharp increase in exports of EEPs mainly to Korea's remarkable ability to make technological improvements in their production.\n- Reestimation of the standard import equation produces estimates similar to those from previous studies.\n- Most imports are industrial inputs and are jointly determined by consumption, fixed investment, and exports."
    },
    {
      "heading": "Methods and approach",
      "content": "- Primary approaches:\n  - Standard demand-based export and import models.\n  - An alternative supply-based model focused on technological improvements in EEP production.\n- Focus on sectoral composition change: increasing share of electrical and electronic products (EEPs) in total exports."
    },
    {
      "heading": "Implications and interpretation",
      "content": "- The compositional shift toward EEPs explains the paradoxical changes in elasticities (lower income elasticity, higher price elasticity) observed in demand-based estimates.\n- Supply-side technological progress is a key driver of export performance in EEPs, rather than demand-side factors alone.\n- Because imports largely consist of industrial inputs, import demand is jointly determined by domestic consumption, fixed investment, and export activity."
    },
    {
      "heading": "Publication and metadata",
      "content": "- Author: Kevin C Cheng\n- Date: August 1, 2004\n- Series: Working Paper No. 2004/145\n- Issue: 145\n- Volume: 2004\n- Pages: 24\n- DOI: https://doi.org/10.5089/9781451856576.001\n- Stock No: WPIEA1452004\n- ISBN: 9781451856576\n- ISSN: 1018-5941\n\nSource: IMF Working Papers — \"A Reexamination of Korea’s Trade Flows: What Has Changed and What Explains These Changes?\", Kevin C Cheng, August 1, 2004.\n\n---\n\n Content in this bundle\n\n- wp04145\n  - wp04145 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp04145 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/30/a-reexamination-of-koreas-trade-flows-what-has-changed-and-what-explains-these-changes-17447"
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    "Authors: Kevin C Cheng",
    "Published: August 1, 2004",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451856576.001",
    "Using standard demand-based models, the paper finds that owing to the increasing share of electrical and electronic products (EEPs) in total exports:",
    "An alternative supply-based model attributes the sharp increase in exports of EEPs mainly to Korea's remarkable ability to make technological improvements in their production.",
    "Reestimation of the standard import equation produces estimates similar to those from previous studies.",
    "Most imports are industrial inputs and are jointly determined by consumption, fixed investment, and exports.",
    "Primary approaches:",
    "Focus on sectoral composition change: increasing share of electrical and electronic products (EEPs) in total exports.",
    "The compositional shift toward EEPs explains the paradoxical changes in elasticities (lower income elasticity, higher price elasticity) observed in demand-based estimates.",
    "Supply-side technological progress is a key driver of export performance in EEPs, rather than demand-side factors alone.",
    "Because imports largely consist of industrial inputs, import demand is jointly determined by domestic consumption, fixed investment, and export activity.",
    "Author: Kevin C Cheng",
    "Date: August 1, 2004",
    "Series: Working Paper No. 2004/145",
    "Issue: 145",
    "Volume: 2004",
    "Pages: 24",
    "DOI: https://doi.org/10.5089/9781451856576.001",
    "Stock No: WPIEA1452004",
    "ISBN: 9781451856576",
    "ISSN: 1018-5941",
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