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The Impact of MRA in the IT sector on the Korean Economy

Author

Listed:
  • Oh, Wankeun

    (Hankuk University of Foreign Studies)

  • Yoon, Choong-Han

    (Hanyang University)

  • Lim, Kwang-Sun

    (Electronics and Telecommunications Research Institute)

Abstract

In this paper, using partial equilibrium models and input-output analyses, we estimate the effects of MRA in the IT sector on the net exports of Korea as well as on the Korean macro economy in the aspects of production, value-added and employment. It is noted that there are significant increases in both net exports and national income, which is mainly made possible by decreases in certification costs and testing costs and hence by final product prices. We show that the MRA with U.S. and/or China has much larger effects on the Korean economy than the MRA with Japan. Among various IT sub-sectors of Korea, the mobile handset industry sector is found out to be the largest beneficiary of MRA. These results make sense in two reasons: U.S. and China are the largest two trade partners of Korea in the IT sector; the mobile handset sector is the largest contributor of exports in Korea.

Suggested Citation

  • Oh, Wankeun & Yoon, Choong-Han & Lim, Kwang-Sun, 2005. "The Impact of MRA in the IT sector on the Korean Economy," East Asian Economic Review, Korea Institute for International Economic Policy, vol. 9(2), pages 85-115, December.
    • Handle: RePEc:ris:eaerev:0174
    DOI: 10.11644/KIEP.JEAI.2005.9.2.145
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    More about this item

    Keywords

    MRA; Trade Balance; IT sector; Input-Output Analysis;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications

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