The impact of a free trade agreement: An empirical study on import growth and consumer price effects of the EU - South Korea Free Trade Agreement
Independent thesis Basic level (degree of Bachelor), 10 credits / 15 HE creditsStudent thesis
In 2011 the European Union and South Korea signed into effect an extensive free trade agreement (FTA). The study in this paper is an initial attempt at analyzing changes in the European Union’s import growth from South Korea after the agreement. We conduct an empirical panel data investigation, where the cross-sectoral variation in tariff reductions is used to isolate the effect of the FTA. By looking at tariff reductions, and also the import intensity of different sectors, we find that imports seem to have grown the most in sectors where the tariff removals were classified as major, and import intensity was large prior to the FTA. The analysis is then extended into the field of consumer prices, where the results from the study imply that, in sectors with high import intensity, large tariff reductions have had a dampening effect on prices.
Place, publisher, year, edition, pages
Free trade agreement, trade liberalization, tariffs, European Union, South Korea, imports, consumer prices
IdentifiersURN: urn:nbn:se:uu:diva-255155OAI: oai:DiVA.org:uu-255155DiVA: diva2:821196
Borota Milicevic, Teodora, Biträdande universitetslektor
Guvå, Tomas, Universitetslektor