Regional Economic Analysis of Major Areas in South Korea: Using a 2005-2010-2015 Multi-Regional Input–Output table

Abstract

South Korea’s Seoul metropolitan area accounts for more than half of the country’s GDP and population. This phenomenon is getting worse annually. Regions outside the metropolitan area of Korea are not only decreasing in terms of economic size, but also becoming more dependent on the metropolitan area in terms of economic structure. In the past, the metropolitan area was based on the service industry and the size of the manufacturing industry was large in other regions, but the size of the manufacturing industry in the metropolitan area also increased over time. To analyze dependence on the Seoul Metropolitan area, this study conducts inter-regional production inducement effects, regional division of labor, and three regional structural decomposition analysis using Korea's 2005-2010-2015 MRIO to further analyze dependence on the metropolitan area. Furthermore, this research integrates industry classification and realizes price level of Input-Output tables to link three years MRIO in three industries: Wholesale and retail trade and product brokerage services, Motor vehicle, and Semiconductor and other electronic components. From the inter-regional production inducement effect, the effect between the metropolitan area and each region is calculated through the regional export and import effects of each region. Furthermore, the proportion of metropolitan areas in major industries and their changes are measured through regional division of labor, and through multi regional structural decomposition analysis, the growth factors of each region over the 10 years are determined by own region, metropolitan area, and other regions.