Korea's Masan free export zone: benefits and costs

In: The developing economies

Abstract

Description of the incentive package and economic characteristics of Masan, one of South Korea's two export processing zones, which began its operations in 1971. Subsequently the net benefits and costs, as experienced by the rest of the Korean economy, resulting from the existence of the zone, is studied. Comparison is made of the welfare outcome for Korea where the zone is present with the hypothetical situation in which it is absent. Benefit-cost estimates concern employment, foreign exchange earnings, domestic raw material and local sales, construction cost lease charges etc. (Economische Voorlichtingsdienst)