Industrial Spillover Effect of Economic Fluctuation and Its Implications
|Author||Hwang Sun -Woong||Date||2014.01.23||Issue No||578|
The GDP fluctuation for individual industries is largely affected not just by macroeconomic factors but also by industry-specific factors.
● Most of Korean industries are affected the most by macroeconomic factors.
● In contrast, more than half of the GDP fluctuation in the industries such as electrics and electronics, construction, healthcare·social welfare, public administration·national defense, is accounted for by the corresponding industry-specific factors.
● Oil·chemical industries are also significantly dependent on the spillover effect from other industries
The industries which have the largest spillover effect on other industries, are electrics and electronics, construction, oil·chemical, wholesale and retail, restaurant ·hospitality businesses.
● In contrast, the industries such as public administration·national defense, healthcare·social welfare, culture·entertainment and education, are estimated to have extremely low spillover effect on other industry.
In order for the balanced growth in the entire sectors, it is required to aggressively use the microeconomic policies which consider the industrial spillover effect of economic fluctuation, as well as the macroeconomic policies like monetary policy and fiscal policy.
● Notably. It is necessary to actively respond to the negative disturbance of the industries which have a great spillover effect on other industries.
● It is also required to come up with complementary measures to strengthen the positive spillover effect of the new growth engine industries such as information·telecommunication, healthcare·social welfare, culture·entertainment and business service.
● It is necessary to improve the capability to analyze and forecast industrial trend reinforce the role of industrial and trade policies to stabilize economy.