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date: 20 October 2021

Abstract and Keywords

This chapter describes trade in intermediate inputs between Korea and China. It focuses on the potential of a “tripartite regional production network” involving Japan as well, reflecting the relative economic development of the three partners. The chapter is organized as follows. Section 2 reviews definitions and measurements. Apart from anecdotes based on management consulting firms, not much systematic evidence quantifying vertical trading exists. Thus, based on the presumption, sections 3 and 4 synthesize evidence of outsourcing in China and provide a comparative perspective for South Korea with China vis-à-vis other countries. Section 5 explores underlying factors and the labor market effects. Section 6 summarizes.

Keywords: trade relations, South Korea, China, Japan, tripartite regional production network, outsourcing, labor market

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