China's Penetration of the Korean Market: Stylized Facts and Welfare Effect

Kichun Kang () and Byung Chul Ahn

China & World Economy, 2010, vol. 18, issue 5, 54-71

Abstract: China's penetration of the world market has been impressive. This paper uses highly disaggregated Korean import data (from 1992 to 2008) to examine China's penetration of the Korean market in the context of the composition of value (the extensive and intensive margins) and the product type (homogeneous and differentiated) in trade. The increase in Chinese imports has been attributed to the rapid increase in the import of new products (the extensive margin) and of existing products (the intensive margin). However, the growth rate of new products decelerated in the 2000s. The growth in the intensive margin was due to quantity, not price. Chinese imports to Korea did not improve over the period in terms of quality. Although Chinese products became cheaper, they were more differentiated over time. Welfare gains were realized through the expanded introduction of new products from China. However, much of the gains from Korea's Chinese product import boom were realized in earlier years (1992–2000) because even though imported products became more differentiated, the increase in the extensive margin was lower in more recent years (2001–2008).

Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1111/j.1749-124X.2010.01212.x

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:bla:chinae:v:18:y:2010:i:5:p:54-71

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1671-2234

Access Statistics for this article

China & World Economy is currently edited by Yongding Yu

More articles in China & World Economy from Institute of World Economics and Politics, Chinese Academy of Social Sciences Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().