• Journal of Intelligence and Information Systems
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• v.27 no.1
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• pp.83-102
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• 2021

The government recently announced various policies for developing big-data and artificial intelligence fields to provide a great opportunity to the public with respect to disclosure of high-quality data within public institutions. KSURE(Korea Trade Insurance Corporation) is a major public institution for financial policy in Korea, and thus the company is strongly committed to backing export companies with various systems. Nevertheless, there are still fewer cases of realized business model based on big-data analyses. In this situation, this paper aims to develop a new business model which can be applied to an ex-ante prediction for the likelihood of the insurance accident of credit guarantee. We utilize internal data from KSURE which supports export companies in Korea and apply machine learning models. Then, we conduct performance comparison among the predictive models including Logistic Regression, Random Forest, XGBoost, LightGBM, and DNN(Deep Neural Network). For decades, many researchers have tried to find better models which can help to predict bankruptcy since the ex-ante prediction is crucial for corporate managers, investors, creditors, and other stakeholders. The development of the prediction for financial distress or bankruptcy was originated from Smith(1930), Fitzpatrick(1932), or Merwin(1942). One of the most famous models is the Altman's Z-score model(Altman, 1968) which was based on the multiple discriminant analysis. This model is widely used in both research and practice by this time. The author suggests the score model that utilizes five key financial ratios to predict the probability of bankruptcy in the next two years. Ohlson(1980) introduces logit model to complement some limitations of previous models. Furthermore, Elmer and Borowski(1988) develop and examine a rule-based, automated system which conducts the financial analysis of savings and loans. Since the 1980s, researchers in Korea have started to examine analyses on the prediction of financial distress or bankruptcy. Kim(1987) analyzes financial ratios and develops the prediction model. Also, Han et al.(1995, 1996, 1997, 2003, 2005, 2006) construct the prediction model using various techniques including artificial neural network. Yang(1996) introduces multiple discriminant analysis and logit model. Besides, Kim and Kim(2001) utilize artificial neural network techniques for ex-ante prediction of insolvent enterprises. After that, many scholars have been trying to predict financial distress or bankruptcy more precisely based on diverse models such as Random Forest or SVM. One major distinction of our research from the previous research is that we focus on examining the predicted probability of default for each sample case, not only on investigating the classification accuracy of each model for the entire sample. Most predictive models in this paper show that the level of the accuracy of classification is about 70% based on the entire sample. To be specific, LightGBM model shows the highest accuracy of 71.1% and Logit model indicates the lowest accuracy of 69%. However, we confirm that there are open to multiple interpretations. In the context of the business, we have to put more emphasis on efforts to minimize type 2 error which causes more harmful operating losses for the guaranty company. Thus, we also compare the classification accuracy by splitting predicted probability of the default into ten equal intervals. When we examine the classification accuracy for each interval, Logit model has the highest accuracy of 100% for 0~10% of the predicted probability of the default, however, Logit model has a relatively lower accuracy of 61.5% for 90~100% of the predicted probability of the default. On the other hand, Random Forest, XGBoost, LightGBM, and DNN indicate more desirable results since they indicate a higher level of accuracy for both 0~10% and 90~100% of the predicted probability of the default but have a lower level of accuracy around 50% of the predicted probability of the default. When it comes to the distribution of samples for each predicted probability of the default, both LightGBM and XGBoost models have a relatively large number of samples for both 0~10% and 90~100% of the predicted probability of the default. Although Random Forest model has an advantage with regard to the perspective of classification accuracy with small number of cases, LightGBM or XGBoost could become a more desirable model since they classify large number of cases into the two extreme intervals of the predicted probability of the default, even allowing for their relatively low classification accuracy. Considering the importance of type 2 error and total prediction accuracy, XGBoost and DNN show superior performance. Next, Random Forest and LightGBM show good results, but logistic regression shows the worst performance. However, each predictive model has a comparative advantage in terms of various evaluation standards. For instance, Random Forest model shows almost 100% accuracy for samples which are expected to have a high level of the probability of default. Collectively, we can construct more comprehensive ensemble models which contain multiple classification machine learning models and conduct majority voting for maximizing its overall performance.

• 한국사회정책
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• v.25 no.4
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• pp.163-198
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• 2018

This study analyzed the change of the Korean welfare regime during the conservative government. It is clear that the welfare expanded during the conservative government, but this expansion was the process of realizing the constraint of expansion that reduces future welfare expenditure in Korea. In addition, as the public welfare centered on social insurance expanded after 10 years of liberal government, the backward selectivity of the Korean welfare regime strengthened in the conservative administration. Expanding social insurance itself does not reinforce the backward selectivity of the Korean welfare regime. However, the industrial structure created by the export-led growth system has intensified the fragmentation of the labor market, and expanding social insurance designed based on regular workers under these conditions has forced the backward selectivity of the social security system. It is for this reason that the backward selectivity has been reinforced during the conservative government.

• The Korean Journal of Air & Space Law and Policy
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• v.32 no.1
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• pp.139-175
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• 2017

The Assembly plenary session on December 3, 2017 passed a Product Liability Amendment bill that introduced clauses concerning consumer burden of proof and punitive damage reimbursement. More specifically, these newly approved provisions will reduce the burden of proof placed on consumers and levy triple punitive damage on suppliers. Significant increases in the number of product-liability lawsuit and the number of related insurance contracts are expected. Since military aircraft are designed for operational purpose(seeking greater combat effectiveness over greater safety) and used in high-risk environment, it is practically impossible to obtain an affordable product-liability insurance, Without having any backup plan, military aircraft manufacturers directly face all sort of liability risks under Product Liability Act, Warrant Liability Act and Non-Performance of Contract Act. The U.S. experienced similar problems when they first implemented their product-liability law in 1970s. There had been a big dispute among legal practitioner, insurance professionals and scholars concerning military aircraft manufacturer's liability. In order to settle the issue, the U.S. Supreme Court has established a new precedent of Government Contractor Defense(GCD). The U.S. government also included an indemnity clause for military aircraft manufacturers in their FMS Contract with the Korean government. Likewise, Korean military aircraft manufacturers should 1) clearly understand their current position that they cannot afford expensive product-liability insurance and the cost is not accounted in the military procurement calculation, 2) estimate potential liability risks with the ongoing overseas export expansion in mind, 3) set up appropriate risk management measures through regulatory reform and policy development.

• International Commerce and Information Review
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• v.8 no.3
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• pp.99-119
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• 2006

The recent trend in the payment terms of international trade shows the gradual shift toward more diversified payment methods (from L/C to not L/C) in order to cope with the increasingly dynamic international transactions in a more flexible manner. The reasons behind this recent shift are as follows : first, the global trade market is breaking away from the traditional L/C methods based on letters of credit toward a not L/C methods. nother reason for the changing trade payment methods is the increasing volume of intra transactions between headquarters and their foreign subsidiaries based on collection payment methods. Having mentioned the above problems that impede the Korean export insurance system, some suggestions can be put forward through a comparative analysis with foreign export insurance system. First, inducing private investments is one way of strengthening financial health of the KEIC. The KEIC also needs to diversify its insurance coverage adapting to the changing international trade environments.

• International Commerce and Information Review
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• v.10 no.4
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• pp.553-577
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• 2008

Various export supporting systems of Korean government have affected Korean economy to be 13th in the world and over US$ seven hundred trillion in terms of the volume. Especially, export insurance system use to cover the commercial risks of Korean exporter. That is why Korean exporter have been able to do their best in exporting and expand overseas market actively. On the other hand, China who use to drive strong export expansion policy after joining WTO, have also very focused on export insurance system and developed its applicable items. From the point of view above, It is very meaningful study to compare the export insurance system between Korea and China. It is suggested that government funds for export insurance should be raised to give exporters more benefits. New kinds of export insurance items, also, should be developed to actively face international trade environment change.

• Korea Trade Review
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• v.44 no.1
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• pp.129-142
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• 2019

This paper draws implications on the ship finance of the Korean ECAs for shipbuilding industry from the perspective of WTO ASCM through studying the trade disputes on export credits. In consideration of the underwriting practice on the case-by-case basis, the ECAs' law regimes and their ship finance programs as such would be judged not conferring a benefit. The ship finance of international commercial banks could be treated as a market benchmark for the purpose of determining the existence of benefit in the ECA ship finance. The ECAs share securities with international commercial banks for the same exposure to the risks in a syndicate. Therefore, WTO DSB would rule that the ECA ship finance confers no benefit for individual transactions. The items (j) and (k-1) of ASCM Annex I are not allowed to interpret a contrario.

• International Commerce and Information Review
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• v.15 no.4
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• pp.195-216
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• 2013

In this paper, I investigate how international prices affect domestic prices and export prices in Korea by using vector error correction model(VECM) and estimate its impact on international trade. According to the empirical results, international prices, such as world raw material prices and oil prices, make stronger effects on domestic prices, in order of import, export, producer, and consumer prices. And recent years the effect of international raw material prices on domestic prices becomes larger. It implies importers, exporters and producers are more affected by international prices than consumers are. Therefore, the international trade, import and export, is affected by changes in international prices. Firms, especially importing and exporting companies, should do much efforts on risk managing about raw material prices variation, diversification of raw material suppliers, and oversea resources development. The government is needed to support on firms those efforts while doing its economic policies to cope with economic conditions and the price policy.

• 한국사회정책
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• v.25 no.1
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• pp.195-229
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• 2018

This study has examined how the welfare system has changed as it has passed through the most controversial period in Korean modern history. The welfare system has changed in a way that adapts to the need for export-led economic growth. Industrialization centered on light industry, which started in the mid-1960s, absorbed the labor force that existed in the rural areas and commodified them, thereby creating a momentum for Korean society to get out of poverty. However, the public de-commodification, ie social security system, adapted to the commodification of the labor force has been institutionalized only in a very limited area and people. Indeed, the de-commodification system was confined to the area directly linked to the reproduction of the labor force. Even so, the target was very limited in the abundance of labor in rural areas. Compulsory medical insurance was rejected because of corporate burden, and industrial accidents insurance was introduced centering on large-scale workplaces. As the Korean economy began to move from the light industry to the heavy industry in the 1970s, the commodificated labor force changed from a low skilled labor force to a skilled male labor force. It is at this time that dual structures have begun to be created between workers employed in export-oriented large enterprises and workers employed in domestic-oriented SMEs. Therefore, the system of de-commodification that supports the reproduction of labor power in response to social risks has also been institutionalized centering on large-scale workplaces.

• International Area Studies Review
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• v.13 no.3
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• pp.781-799
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• 2009

Korea and China should come up with a mutually beneficial FTA proposal at an early date and thus lead the way towards the FTA. An FTA with China is a key issue of economic cooperation in order to confront soaring Chinese competitiveness in international markets. The purpose of this research paper is to analyze the overall Busan regional economy impacts of the Korea-China FTA. We analyzed the quantitative effects of an FTA by using microeconomic concept. The Korea-China FTA will have positive effects on the overall industry in Busan. Therefore, Busan regional industries exports and imports are expected to grow. Busan is worried the deal would pave the way for imports of cheap Chinese agricultural products, hurting the nation's already fragile agricultural sector. In contrast, Busan's manufacturing sector is expected to see its surplus rise. In sum, we think the FTA will bring benefit to the whole industry in Busan Regional economy because it accelerates development of the industries by trade and investment along with comparative advantage.

• Korea Trade Review
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• v.46 no.6
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• pp.73-92
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• 2021

Small and medium-sized enterprises (SMEs) account for a large proportion of the total number of enterprises in many countries. The development of SMEs has contributed to job creation and economic benefits. Every government has formulated active diversification strategies to promote the export market of SMEs, but the performance of export capabilities remains insufficient. The primary purpose of this study is to examine the effectiveness of export credit insurance in promoting SME export performance in Canada. Using data from 2008-2017, the augmented Dickey-Fuller (ADF) model to test the stationarity of the concerned variables and the error correction model (ECM) and autoregressive distributed lag (ARDL) cointegration test to empirically investigate the cointegration relationship between the research targets. The results represent the positive and critical impact of export relative price and domestic demand pressure on Canada's export performance, and the negative impact of the export volume index at a significant level. Regrettably, the impact of export credit insurance on the export performance of Canadian SMEs is considered exaggerated overall. In view of this result, it is necessary for the Canadian government to enact policies based on the current market status. And enhance confidence among SMEs to begin exports and diversify their markets rather than focusing only on the domestic or US market, especially given the impact of COVID-19. From the case of Canada, Korean government can attempt to learn from them to conduct more efficient strategies for SMEs.