Assessing the Impact of the Revised WTO Information Technology Agreement (ITA) Towards Koreas IT Industry: A Partial Equilibrium Model

Abstract

Korea is a small yet important IT country

it is the fourth largest exporter and seventh largest importer of IT products covered in the Information Technology Agreement (ITA). Although ITA has contributed to increasing global IT trade and has benefited consumers around the world, some industries have been subjected to increasing competition from strong IT countries. This is the case for Korea, a country that is being sandwiched between China and Japan in the global IT market.

The objective of this research paper is to simulate the effects of ITA2, which is an expansion of ITA1, on Koreas IT industry using the World Integrated Trade Solution SMART (Software for Market Analysis and Restrictions on Trade) program – a partial equilibrium modeling tool – to measure Koreas trade competitiveness against China and Japan. The partial equilibrium approach can generate useful insights on the relatively complex, multi-country trade policy changes at the industry level.