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Working Paper

Proliferation of Free Trade Areas : What It Means to Korea

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커버이미지
  • 저자 박영철(朴英哲) , 유정호(兪正鎬)
  • 발행일 1989/07/01
  • 시리즈 번호 8918
원문보기
요약 The purpose of this paper is to analyze the implications of
FTAs for bilateral as well as multilateral trade relations from
the perspective of a small open economy, that is, the Republic of
Korea(henceforth, Korea). The case for a bilateral FTA must in
the end be based on a better understanding of whether such an
arrangement would help improve the allocative efficiency and
welfare of the two partner countries. Section Ⅱ is devoted to an
examination of this question by focusing on how FTA affects
trade patterns in a setting where intermediate inputs are traded
and taxed. In particular. the section discusses the possibility of
trade suppression and trade reversal effects. It also discusses
some of the advantages the center country may enjoy in
comparison with other partners in a start-shaped FTA. Section
Ⅲ considers some of the economic forces that could steer the
U.S.-Canada FTA into a customs union. Against this
background, arguments for and against a bilateral FTA between
Korea and the U.S. are analyzed. Concluding remarks are found
in Section Ⅳ.

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