IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

The Effects of Trade Openness on Regional Inequality in South Korea

Listed author(s):
  • Soojeong Heo


  • Jinhwan Oh
Registered author(s):

    This paper is to analyze the effect of trade openness on regional inequality of South Korea. Trade has been the driving force of Korea's economic growth since the 1960's and it still expands its trade openness through active participation on bilateral and multilateral free trade agreements. In regard to this, this study measures the impact of Korea's trade openness on the country's regional inequality using several sub-national panel dataset covering between 2003 and 2012. All data set for the 16 regional units (nine provinces and seven metropolitan cities) are collected from archival materials in Korean Statistical Information Service (KOSIS). The dependent variable is the growth rate of GDP per capita from.2000 to 2012, while the explanatory variables include human capital, trade openness, infrastructure, and per capita income. More specifically, human capital is measured by the number of people who have achieved university level education and infrastructure is measured by either road density or per capita number of cars, depending on data availability. Unlike other studies, this paper finds that trade openness contributes to higher level of economic growth on the regions with lower levels of education, implying that trade openness leads reducing regional inequality of Korea. In addition, trade benefits the areas with relatively lower per capita income, which also supports the claim that trade contributes to narrowing the regional income discrepancies. However, a seemingly contradictory finding has been made; more trade openness benefits regions which have rich infrastructure, thereby leading more regional inequality. We argue that the former two effects exceed the latter, thereby leading concluding that trade openness has been playing a positive role in reducing the country's regional income gap.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL:
    Download Restriction: no

    Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa15p1057.

    in new window

    Date of creation: Oct 2015
    Handle: RePEc:wiw:wiwrsa:ersa15p1057
    Contact details of provider: Postal:
    Welthandelsplatz 1, 1020 Vienna, Austria

    Web page:

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:wiw:wiwrsa:ersa15p1057. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Gunther Maier)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.