Finding beneficiaries: trade adjustment assistance system in South Korea

Author:Joon-heon Song
Position:School of Business and Commerce, Tokyo International University, Saitama, Japan
Pages:92-105
SUMMARY

Purpose The purpose of this study is to explore the essential cause for the policy failure of Trade Adjustment Assistance (TAA) in South Korea. Design/methodology/approach To substantiate the claims made for the failure of the policy, this paper focuses on the differences in policy preferences among the government ministries and agencies involved in TAA. Findings The... (see full summary)

 
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Finding beneciaries: trade
adjustment assistance system in
South Korea
Joon-heon Song
School of Business and Commerce, Tokyo International University, Saitama, Japan
Abstract
Purpose The purpose of this study is to explore the essential cause for the policy failure of Trade
AdjustmentAssistance (TAA) in South Korea.
Design/methodology/approach To substantiate the claims made for the failure of the policy, this
paper focuses on the differences in policy preferences among the government ministries and agencies
involvedin TAA.
Findings The failure in the TAA policy, according to this study, was attributed to the conicts and
miscoordination arising from the differences in policy preferences among government ministries and
agencies. To rectify this failure,the South Korean government had to revise its laws and regulations several
times over a shortperiod.
Originality/value Drawing on the analytical framework of the literature on policy failure, this paper
examines the causal relationships between outcomes of TAA policy and the conicts or miscoordination
among governmentbodies at each stage: initiatives and planning, implementationand operation of the policy.
Keywords South Korea, Free trade agreement, Policy failure, Policy preferences,
Trade Adjustment Assistance (TAA)
Paper type Research paper
1. Introduction
In 2006, the South Korean government introduced the TradeAdjustment Assistance (TAA)
system in the course of implementing the proactive free trade agreements (FTAs) policy.
The goal of the TAA system is to assist rms and workers adversely affected by the FTAs.
According to the New Trade Roadmapreleasedin June 2013, the government plans to use
TAA actively to support domestic industries. With a growing number of FTAs, it was
widely recognized that vulnerable domestic sectors required assistance programs for the
early conclusion of FTA negotiations and further trade liberalization. Leaving aside
arguments about the validity of government interventions, the implementation and
successful operation of TAA system still forms an important component of South Koreas
FTA policy.
However, the TAA system has been considered a policy failure in South Korea (Heo,
2013a), although there were expectations of it being an effective remedy for the victims of
trade liberalization. According to government gures, only 82 rms were designated as
beneciaries of TAA in a span of approximately 10 years. Besides, there hasbeen no formal
support so far for the workers. In the initial phase of the introductionof TAA, the poor use of
the system was attributed to a lack of awareness (Jeon and Cheong,2010;Cheong and Cho,
2011). Later, the extremely limited eligibility and complicated application procedures for
benets were cited as the reason for its non-use (Choi, 2011;Song, 2011;Cheong and Cho,
2011;Kang, 2013). Regrettably, despite the lapse of time and several amendments to the
JITLP
16,2
92
Received 22 March 2017
Revised 8 May 2017
Accepted 9 May 2017
Journalof International Trade
Lawand Policy
Vol.16 No. 2, 2017
pp. 92-105
© Emerald Publishing Limited
1477-0024
DOI 10.1108/JITLP-03-2017-0010
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/1477-0024.htm

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