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Impact of Rules of Origin on FTA Utilization in Korean FTAs

Author

Listed:
  • Kim , Hansung Daniel

    (Independent)

  • Cho , Mee Jin

    (Korea Institute for International Economic Policy)

Abstract

Despite the intense interest concerning Rules of Origin (ROO) in every corner, research regarding ROO has been relatively limited. It is primarily due to the difficulties of performing systematic research on ROO. The importance of the role of ROO in FTA, however, cannot be overemphasized since the economic effect of concluding an FTA is determined by ROO, in particular with respect to the market access. This study aims to investigate the economic effect of ROO of Korean FTAs on its FTA utilization. Using restrictive index, margin of preferences and other relevant variables, we test the relation between FTA utilization and related variables. The results show that more restrictive ROO has a negative impact on the utilization rates, when we drop the products with zero utilization rates and control for industry-specific characters. It also shows that higher MOP promotes the use of the Korea-ASEAN FTA. On the other hand, we fail to show that the average value of imports per-application has a positive impact on the use of FTA.

Suggested Citation

  • Kim , Hansung Daniel & Cho , Mee Jin, 2010. "Impact of Rules of Origin on FTA Utilization in Korean FTAs," Working Papers 10-8, Korea Institute for International Economic Policy.
    • Handle: RePEc:ris:kiepwp:2010_008
    DOI: 10.2139/ssrn.2489806
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    Citations

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    Cited by:

    1. Lukaszuk, Piotr & Legge, Stefan, 2019. "Which Factors Determine the Utilization of Preferential Tariff Rates?," VfS Annual Conference 2019 (Leipzig): 30 Years after the Fall of the Berlin Wall - Democracy and Market Economy 203639, Verein für Socialpolitik / German Economic Association.
    2. Legge, Stefan & Lukaszuk, Piotr, 2024. "The firm-level costs of utilizing free trade agreements," International Economics, Elsevier, vol. 178(C).

    More about this item

    Keywords

    Rules Of Origin; FTA; Korea-ASEAN FTA; Restrictiveness Index;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration

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