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The Effects of Changes in Exchange Rate, Interest Rate, and Wage on Korean Exports exchange rate

Author Chong Man Kim Series 92-27 Language Korean Date 1992.10.23

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Recently, there have been worries regarding Korea's inactivity in exports. Korean exports grew by just 5.8 percent on average from 1989 to 1991, while Korea's rival economies, including Hong Kong, Singapore and China, recorded an average 15-percent rate of increase.

This paper indicates the internal and external factors observed in the international finance market and their implications for international economic trends.
In terms of external factors, it shows the strengthening of the United States and developing nations' competitiveness. It also indicates a slowdown of the economy growth rate in OECD member nations Internal factors of Korean exports have stagnated, causing taxation rates to increase and domestic finance demand to rise, leading to severe labor disputes in the process of democratization and sudden increases in capital demand and price instability. Moreover, the sharp revaluation of the won since 1986 is also considered a factor in Korea's export slowdown.

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