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1、Chapter8KoreanAutomobileIndustry’sProductionNetworkinChinaChapter8KoreanAutomobileIndustry’sProductionNetworkinChinaSungChunJungKoreanInstituteforInternationalEconomicPolicyMarch2008ThischaptershouldbecitedasSungChunJung(2008),‘KoreanAutomobileIndustry’sProductionNetworkinChina’,inAriff,M.(ed.),
2、AnalysesofIndustrialAgglomeration,ProductionNetworksandFDIPromotion,ERIAResearchProjectReport2007-3,Chiba:IDE-JETRO,pp.331-367.8iKoreanAutomobileIndustry’sProductionNetworkinChinaSungChunJungKoreaInstituteforInternationalEconomicPolicy,KoreaAbstractThispaperexaminesthecharacteristicsoftheproduct
3、ionnetworkofKoreancarmakersinChina.ItwasfoundthatKoreanautomotivefirmsinChinaareformingproductionnetworksaroundBeijingwhereHyundaiMotorsislocated.TheproductionnetworkofKoreanautomotivefirmshaschangedfromtheverticalandclosedstructureintoamorehorizontalandopenstructurewiththeintensifyingcompetitio
4、n.ThispapersuggeststhatthegovernmentneedstoselectandraisetheKoreanfirms’performancetoenhancetheircompetitivenessinChina.INTRODUCTIONIn2006,theKoreanautomobileindustryrankedfifthlargestautomobileproducerintheworld,followingJapanandtheUnitedStatesaftermakingdramaticallyrapidprogresssinceitstartedw
5、ithalmostnofootholdintheindustryaboutfiftyyearsago.Furthermore,theKoreanautomobileindustryholdsaprominentpositioninthenational331economy.Asof2005,itaccountedfor8.9percentofthetotalemployees,11.5percentofthegrossoutput,10.2percentofthevalueaddedamountand10.3percentofthetotalexportamountinKorea’sm
6、anufacturingsector.Directandindirectemploymentcreationeffectsreachedup1.57millionemployees,accountingfor10.38percentofthetotalemployment.Moreover,thetradesurplusfromtheindustryrecorded29.9billionUSdollarsin2006,makingitthelargestexportingindustryofKorea.Table1:ASummaryofKoreanAutomobileIndustryN
7、umberofValueofExportValueaddedNumberofworkersGrossoutputestablishmentsshipmentamountamountYearBil.Bil.Bil.Bil.firms%thousand%%%%%KWKWKWUS$1985882281.73.353.34.263.34.265.41.813.8719902,1383.1186.36.1716.29.1616.19.1819.12.94
