Factor Supply and Factor Intensity of Trade in Korea.—By Wontack Hong. Korea Development Institute, Seoul, Korea. 1976.

The main purpose of the book is to investigate the changes in the factor intensity of Korea’s trade. The time span covered for the analysis is 1960-1973, the period during which Korea experienced both rapid capital accumulation and a prodigious expansion of manufactured exports. The book contains 12 chapters in all. Following an introductory note, Chapter 1 presents an overview of growth and trade in Korea. It is shown that annual commodity exports of Korea, which amounted to less than 100 million before 1962, increased at an average annual rate of 40% during 1962-73 and were around $3200 million in 1973 and §4500 million in 1974. The share of manufactured goods in total commodity exports, which never exceeded the 20 percent level during 1953-61, steadily increased thereafter and had reached a level of over 90 percent after 1970. It is further shown that in the Sixties in Korea, import substitution and export expansion went concomitantly and that private entrepreneures determined the allocation of resources. However, in the Seventies, the government encouraged entrepreneurs to diversify exports away from unskilled labour-intensive manufactures, for example, textiles and ply-wood, to relatively skill intensive and moderately capital-intensive manufacturing, such as the ship-building and machinery industries. This was necessary if the country was to take full advantage of the changing comparative costs which were becoming apparent in her foreign trade.