Citation

Discussion Paper Details

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Title: Industrial Organization and Trade Liberalization: Evidence from Korea

Author(s): Jaime de Melo and David Roland-Holst

Publication Date: May 1990

Keyword(s): Industrial Organization, Korea, Protectionism, Returns to Scale, Tariffs and Welfare Costs

Programme Area(s): International Trade and Regional Economics

Abstract: Based on evidence about industrial organization and market structure, this paper develops a CGE model with increasing returns to scale (IRTS) in selected industrial sectors in order to estimate the welfare gains Korea would achieve from abolishing the import restraints (tariffs and equivalent measures) prevailing in 1982. Under constant returns (CRTS) across the board, welfare gains are estimated at 1% of GDP. With IRTS in three industrial sectors, welfare gain estimates range from -0.5% to 10% of 1982 GDP, depending on the assumptions concerning price setting behavior and profit levels that existed under protecti.

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Bibliographic Reference

de Melo, J and Roland-Holst, D. 1990. 'Industrial Organization and Trade Liberalization: Evidence from Korea'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=399