Growth and Convergence in a Two-region Moddel: The Hypothetical Case of Korean Unification

Michael Funke and Holger Strulik

No 212003, Working Papers from Hong Kong Institute for Monetary Research

Abstract: The paper discusses the impact and implications of Korean unification by setting up a two-region endogenous growth model. The numerical solutions are based on the formal analytical model, and have been calibrated so that they reflect the observed features of the North and South Korean economies. The numerical solutions provide evidence about the speed of convergence and the large amount of interregional transfers that would be required to make the North Korean economy economically viable. We also model the impact of foreign aid, migration and borrowing abroad for the transition process.

Keywords: Korean Unification; Regional Convergence; Economic Growth (search for similar items in EconPapers)
JEL-codes: H31 H40 O41 O52 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2003-10
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Related works:
Journal Article: Growth and convergence in a two-region model: The hypothetical case of Korean unification (2005)
Working Paper: Growth and Convergence in a Two-Region Model: The Hypothetical Case of Korean Unification (2005)
Working Paper: Growth and Convergence in a Two-Region Model: The Hypothetical Case of Korean Unification (2002)
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