The economic effects of economic cooperation of Korea, China, and Japan

Today's world economy is changing on a daily basis with extensions in the economic cooperation of various countries. With the deepening of the so-called block economy, as in the case of Korea where reliance on other countries is high, any form of a weakened foreign trade might result in the decline in competitive power and retardation in economy growth of participating country states. The purpose of this study is to examine each stage of the industrial development of Korea, China, and Japan, as well as to establish the specialization strategy of industry from this economic cooperation perspective. Thereafter, the effects of the Korea-China-Japan economic cooperation are evaluated and analyzed. The analyses of this study are largely divided into two parts. First, the analysis of input-output model among the three countries is conducted in order to establish the specialization strategy of industry, stressing industries that have higher production inducement coefficients. Second, after evaluating each production inducement coefficient and by applying real values to final demand by country and industry (i.e., in both cases of "no cooperation"and "economic cooperation"), we compare the figures of each scenario and analyze which case is more economically efficient.