Journal of the Korean Society of Clothing and Textiles (한국의류학회지)

The Korean Society of Clothing and Textiles (한국의류학회)
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Predicting the Interconnection between Trade Balance and Economic Growth in the Textile and Clothing Industry -A VARX Model Approach-

의류산업 무역수지와 경제성장의 상호연관성 및 예측 연구 -VARX 시계열 모형을 활용하여-

  • Hyojung Kim (Dept. of Fashion Industry, Ewha Womans University)
  • 김효정 (이화여자대학교 의류산업학과)
  • Received : 2024.03.25
  • Accepted : 2024.06.11
  • Published : 2024.10.31
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Abstract

International trade in the clothing industry has contributed significantly to South Korea's economic development. This study examines the interplay between textile and clothing exports, imports, and gross domestic product (GDP) growth from a macroeconomic perspective using a model with vector autoregressive with exogenous variables (VARX). The findings indicate that GDP growth negatively impacts textile and clothing exports but is positively correlated with imports. Furthermore, GDP growth from one and two years prior negatively affects current exports while positively influencing imports. Macroeconomic indicators, including the consumer price index, private consumption index, and producer price index, significantly impact the textile and clothing trades. By contrast, the won/dollar exchange rate and the Bank of Korea's base interest rate do not appear to exert any substantial effect. An unexpected impulse from GDP growth strongly affects the status of textile and clothing imports. Predictions for the future indicate stable GDP growth over the next five years, with high volatility anticipated in the clothing industry's trade balance. This study applies endogenous growth theory to the global clothing trade, yielding theoretical insights, and offers empirical guidance for government agencies wishing to support domestic clothing trade firms.

Keywords

Acknowledgement

이 논문 또는 저서는 2022년 대한민국 교육부와 한국연구재단의 인문사회분야 신진연구자지원사업의 지원을 받아 수행된 연구임(NRF-2022S1A5A8050460).

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