A Study On Trade Effects Of Traffic Infrastructure Connectivity Between China And South Korea

With China's “One Belt and One Road” strategy and South Korean's Eurasia Initiative being proposed,and the geographical position of the two countries facing each other across the sea,the traffic infrastructure connectivity between China and South Korea has more and more influence over the trade between the two countries.So on the basis of realizing the important role of the traffic infrastructure,both China and South Korea need consider how to enhance the traffic infrastructure connectivity and create more convenience for trade between the two countries.This paper first defines the concept of traffic infrastructure,connectivity and the trade effects,including social welfare and division of labor.Next,this paper collects the traffic infrastructure connectivity of the two countries and summarizes their progress and limitations.Then,this paper divides the traffic infrastructure into three layer index,uses factor analysis method to measure the actual connection between China and South Korea.The results are applied to the extended gravity model to test the impact of the connectivity of the traffic infrastructure connectivity on the size and structure of China and South Korea's international trade.The empirical results show that the traffic infrastructure connectivity has promoting effect to the China and South Korea's trade scale.On average,every 1% increase in connectivity level,the volume of trade will rise by 0.668%.The positive correlation shows that it has played a role in the promotion of international trade.In the aspect of the trade structure,the traffic infrastructure connectivity has more influence on manufactured goods.And after further subdivision of manufactured goods,it's found that with the improvement of connectivity level,the impact on capital-intensive products is greater than the impact on the labor-intensive products.Finally,this paper put forward suggestions from seven aspects to improve the level of the trade between China and South Korea via the connectivity of traffic infrastructure.