Reduction of Regulatory Restrictiveness in Services Sectors and Its Impact on FDI Inflows

Jong Duk Kim (), Boyoung Choi (), Moonhee Cho () and Min-chirl Chung ()
Additional contact information
Jong Duk Kim: Korea Institute for International Economic Policy, Postal: Building C, Sejong National Research Complex, 370, Sicheong-daero, Sejong-si,Korea, http://www.kiep.go.kr/index.do
Boyoung Choi: Korea Institute for International Economic Policy, Postal: Building C, Sejong National Research Complex, 370, Sicheong-daero, Sejong-si,Korea, http://www.kiep.go.kr/index.do
Moonhee Cho: Korea Institute for International Economic Policy, Postal: Building C, Sejong National Research Complex, 370, Sicheong-daero, Sejong-si,Korea, http://www.kiep.go.kr/index.do
Min-chirl Chung: Korea Institute for International Economic Policy, Postal: Building C, Sejong National Research Complex, 370, Sicheong-daero, Sejong-si,Korea, http://www.kiep.go.kr/index.do

No 00-0, World Economy Brief from Korea Institute for International Economic Policy

Abstract: The reduction of regulatory restrictiveness in services sectors in Korea using recent free trade agreements in effect and its impact on FDI inflows are investigated. The research outcomes provide three main findings as follows. First, FDI inflows of Korea closely follow the trend of global FDI flows. FDI inflows to Korea from developed economies have appeared dominant; FDI inflows from the U.S., Japan and European economies account for the major share. The increase of FDI inflows from China is significant. Moreover, the FDI inflow shares of capital-intensive industries such as electronic, chemical, and machinery in manufacturing and financial, distribution, and business in services are also large. The fact that FDI inflows in services have become two times larger than those in manufacturing since early 2000s is noteworthy. In the meantime, while FDI flows in forms of M&A in most developed economies, M&As as a form of FDI are still less prevalent in Korea. Second, Koreas services trade restrictiveness indices provided by the OECD are updated and recalculated reflecting the FTAs recently put in force. Further liberalization through recent FTAs in force is identified in legal, accounting and telecommunications services. Third, the impact of services liberalization on FDI inflows in Korea is analyzed. As suggested in theoretical predictions, further services liberalization through FTAs plays a positive role in FDI inflows in Korea. Such outcomes are derived not only in services sectors but in manufacturing sectors as well.

Keywords: FDI (search for similar items in EconPapers)
JEL-codes: A10 (search for similar items in EconPapers)
Pages: 3 pages
Date: 2018-01-12
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ris:kiepwe:2000_000

Access Statistics for this paper

More papers in World Economy Brief from Korea Institute for International Economic Policy [30147] 3rd Floor Building C Sejong National Research Complex 370 Sicheong-daero Sejong-si, Korea. Contact information at EDIRC.
Bibliographic data for series maintained by Geun Hye Son ().