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What Matters For The Extensive And Intensive Margins Of International Trade? Evidence From Korean Exports

  • KICHUN KANG

    ()

    (School of Economics and Finance, Yeungnam University, 214-1 Dae-Dong Kyeongsan-si Gyeongsangbuk-do 712-749, Korea)

Recently, there has been increased interest in the distinction between the extensive margin (EM) and the intensive margin (IM) of international trade. Between 1988 and 2006, the growth of the EMs and IMs of Korean exports has been diverse across its destinations. This paper links each component of the trade value (EM, IM, price index and quantity index) to factors that have been identified as trade determinants in the suggested model. This paper finds that the destination GDP, distance, tariffs, language, existence of an export promotion agency (EPA), local infrastructure and import procedures have an effect on the EMs and IMs of Korea's exports, and the effect works largely through the IM. This paper examines the external environment that shapes the contributions of each of these margins of a country's exports.

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Article provided by World Scientific Publishing Co. Pte. Ltd. in its journal The Singapore Economic Review.

Volume (Year): 57 (2012)
Issue (Month): 03 ()
Pages: 1250018-1-1250018-21

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Handle: RePEc:wsi:serxxx:v:57:y:2012:i:03:p:1250018-1-1250018-21
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