earticle

영어

In comparison with other nations, the roles of Big Trading Houses (BTHs) become increasingly important in Korea because the country heavily relies on foreign trade. Considering its industrial structure, Korea has no choice but depending on international trade than any other nations. This paper theoretically examines the raison d'etre of BTHs in Korea. As Korea has pursued export-oriented policy since the early 1960s, BTHs have performed important roles to promote national economic growth. Until today, only a few papers investigated BTHs' nature and functions from theoretical viewpoints. This paper, thus, explains the reasons for their existence by adopting the following four theoretical frameworks; 1) a theory of financing advantage of trade credit, 2) a theory of international trade with intermediaries, 3) a theory of transaction cost, and 4) a law of increasing returns to scale.