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The Impact of China-US Trade Conflict on Korean Economy

Journal: SocioEconomic Challenges (SEC) (Vol.4, No. 4)

Publication Date:

Authors : ;

Page : 18-28

Keywords : China; US; China-US Trade War; Korean Economy; WIOTs;

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This paper concentrated on how US-China Trade conflicts would have impacts on Korean economy. Making the best use of WIOTs (World Input Output tables), this research focused on value added contents in trade instead of traditional trade statistics in the light of double-counting problem. Thus, the paper set two feasible bad-case scenarios: when China and US's GDP fall and when China and US's exports fall. Making a comparison of the results from the two models, the ripple effects that Korea would suffer from are bigger in China's case. Even though it is under the same condition where China and US's GDP identically fall by 1%, China's case would bring about stronger impacts on Korea. In a nutshell, the outcome illustrates that the extent of the damage that Korea would undergo is always larger in China's bad-case scenarios compared to US's bad-case scenarios which reveals that Korea is more associated with China than US in global value chains. The findings of the analysis are arranged and diagrammed in a table as follows.

Last modified: 2021-01-12 00:32:59