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Korea's Tied Aid for Export and Competition with China

Author

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  • La, Jung Joo

    (Seoul National University)

Abstract

This paper investigates the new link between the export-creating effects of Korea's tied aid and the export-diverting effects coming from China's export expansion, which have been rarely explored by the existing studies. A panel data consisting of 98-104 aid recipients of Korea through the period of 1995-2009 shows that the net export-creating effects are weaker at the export destinations where the export competition between Korea and China is fierce, while they are stronger at the export markets where it is not so severe. These findings applies to consumption goods rather than capital and intermediate goods.

Suggested Citation

  • La, Jung Joo, 2013. "Korea's Tied Aid for Export and Competition with China," East Asian Economic Review, Korea Institute for International Economic Policy, vol. 17(1), pages 81-100, March.
  • Handle: RePEc:ris:eaerev:0064
    DOI: 10.11644/KIEP.JEAI.2013.17.1.260
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    More about this item

    Keywords

    Net Export-Creating Effects; Koreas Tied Aid; Chinas Export-Diverting Effects; Export Competition; Consumption Goods;
    All these keywords.

    JEL classification:

    • F19 - International Economics - - Trade - - - Other
    • F35 - International Economics - - International Finance - - - Foreign Aid
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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