Essays on empirical studies in East Asian economy
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The dissertation consists of three chapters. The first chapter focuses on vertical specialization and the triangular trade structure in East Asian production network. First of all, we introduce the structure of Asian international input-output table and then show how to decompose gross exports by using the input-output tables. The empirical results indicate that Chinese share of value added exports in gross exports have been decreasing but that of Asian value added increasing not only in China but also in the other countries. The share of domestic value-added for the manufacturing sector re- veals that China has moved downstream in the regional production networks. In other words, China has been depending more on its upstream economies like Japan and South Korea. Similarly, the analysis of value added exports shows that a large portion of value added in South Korea's exports comes from Japan. Furthermore, Japan is a major supplier of value added in regional production networks especially in service and manufacturing sectors. In the second chapter, the Hecksher-Ohlin-Vanek model is investigated by using the data sets of China, Japan, Korea and the U.S. Even though there have been a lot of research on the Hecksher-Ohlin-Vanek model, which is also known as, the factor content of trade. In the literature, most researches have been fail- ing to support the model. Two important reasons of the failure are international technology differences and trade of intermediate inputs according to the previous literature. Recently, several articles introduced the modified Hecksher- Ohlin-Vanek model, which allows technology difference and takes care of the trade of intermediate inputs. They showed significant improvement in its pre- diction power of the model. By using Asian international input output table, we calculate all the testing statistics of bilateral trade among China, Japan, South Korea and the U.S. and then verify that we can support Vanek consistent results. In the third chapter, we consider the Korean search engine industry. The importance of the search engine industry is from not only the pricing scheme, but also the highly concentrated market structure. We argue that the unique property of the industry for Internet web search is distinguished by indirect network externalities so we construct a simple platform competition model. Using the estimated values of the model, we try to analyze the welfare in three cases, where the competing private platforms maximize their profits, the social planner maximize welfare with or without consideration of the network externalities. By doing so, we can verify the classical and the network deadweight loss, and then we can compare the social welfare of each case. Some of previous papers study the question whether the less competition makes the social welfare reduced. Interestingly, we find that there is a possibility that monopolization can give positive consequences on social welfare because of the network externality. Therefore, we could consider to allow mergers and acquisitions between search engines. Intuitively, we compare the results from oligopoly market structure with the higher competitive market like current one and demonstrate that our suggestion could induce improvement in innovation on search quality, and social welfare as well.