I am an associate research fellow at the Korea Development Institute
My research interest is in international trade. My research mainly focuses on how production networks and firm-to-firm relationships can change the policy implications of standard international trade models.
You can find my CV here
Reach me at hyungjinkim@kdi.re.kr
Working paper
Export Controls and Endogenous Upstream Price Incidence: The Chip War’s Consequences for the AI-Chip Industry
Modern semiconductor production is vertical, granular, and concentrated. Standard trade models view export controls as output wedges that reduce the targeted firm's market access. This paper argues that in a bilateral oligopoly, such controls also force a renegotiation of upstream input prices. I develop a vertical production network model in which AI-chip designers negotiate with a concentrated set of High-Bandwidth Memory (HBM) suppliers. Using administrative customs data, I document price divergences consistent with relationship-specific bargaining. In the calibrated model, I show that upstream suppliers effectively act as shock absorbers: they lower input prices for the targeted buyer to maintain capacity utilization, cushioning the regulatory blow. This endogenous input-price dampening is quantitatively significant---roughly one-third the magnitude of the markup response---implying that standard models overstate the pass-through of export controls in high-tech supply chains.
Work in progress
Trade, Multinational Production, and Regional Inequality (with Mira Rim)
Globalization often brings openness to trade and multinational production (MP) together, but their combined effects on regional economies are not yet fully understood. We study how China’s openness to trade and MP affected regional inequality in Korea, focusing on population distribution and welfare. To analyze this, we develop a multi-country, multi-sector general equilibrium model that incorporates international trade, MP, and internal migration. Our model captures two opposing effects of Korea’s increasing MP in China. On one hand, MP may reduce labor demand in Korea as firms relocate production. On the other hand, through vertical fragmentation—where Korean firms producing in China source inputs from Korea—it may increase labor demand in Korea. Additionally, welfare effects may vary across worker groups, which are defined by their region of origin. This variation arises because workers have different sector-specific productivity across regions, and migration costs limit their ability to move between regions. A counterfactual analysis of the China Shock shows that while Korea experiences aggregate welfare gains, these are unevenly distributed across worker groups. As a result, some regions attract more migrants than others.
Triadic Gravity in Intermediated Petrochemical Trade (with Yang Shen)
We provide new empirical evidence on the triadic gravity linking buyers, sellers, and intermediaries. Using a unique transaction-level dataset from a Korea-based global petrochemical trading house operating through 25 international offices, we document that all three geographical legs—origin-destination, origin-intermediary, and intermediary-destination—critically shape trade margins and prices. To interpret these patterns, we develop a model of endogenous routing in which firms choose between direct and indirect routes based on costs. We show that the option to switch modes strictly attenuates the bilateral trade elasticity relative to the canonical Melitz benchmark. By deriving a sufficient statistic for this selection margin, we estimate these attenuated elasticities and show that standard gravity models overstate the trade-flow response to physical transport shocks.