From Patron to Partner: The Development of Korean Business and Trade Relations (review)

Book Reviews245 From Patron to Partner: The Development of Korean Business and Trade Relations. Edited by Karl Moskowitz. Lexington, Mass.: Lexington Books (D.C. Heath), 1984. 234 pp. From Patron to Partner is a product of joint efforts by Korean and American scholars to examine the business and trade relationships that have grown between the United States and Korea in recent years, when Korea's rapid development has made it a major U.S. trading partner. The book opens with an introductory chapter by Moskowitz that outlines the historical background, sets forth the objectives of the study, summarizes the contents, and discusses what was omitted. This is followed by four chapters on capital and technology flows. The first, by EuI Yong Park, applies Kojima's hypothesis to determine whether Japanese and American investments in Korea differ in their effects on trade. Dong Sung Cho, in the second, uses a taxonomic approach and a survey of managers' perceptions to characterize Korean and U.S. government attitudes on inward and outward investment . In the third of these chapters, Brian Levy presents a case study of major investments by Dow Chemical in Korean operations. The fourth chapter, by Kee Young Kim, surveys Korea's technology acquisition policies, tests a series ofcharacteristics that might distinguish U.S. from other countries' technology transfers, and recounts the Hyundai Motor Company experience to illustrate the transfer process at the firm level. The next three chapters treat trade relationships between the two countries. Ku-Hyun Jung examines trade channel evolution, especially the changes in shares of Korean exports handled by foreign retailers and importers and by Korean and Japanese general trading companies. The following chapter by John Odell focuses on how the U.S. and Korean governments handle trade disputes over Korean exports while the next chapter, by Karl Moskowitz, examines "transnational alliances between private-sector organizations in the U.S.— Korea trade relationship" such as that of U.S. wheat growers with Korean flour millers and end users. The ninth and last chapter by Hak Chung Lee fits neither the capital-and-technology-flow nor the trade-relationship rubrics. Instead, Lee reviews the development of management education in Korea and American influence on this development. This brief summary reveals that Patron to Partner encompasses many topics and that these are treated by their authors in widely differing ways. Individual chapters also differ greatly in topical sig- 246Journal of Korean Studies nificance, originality, analytical sophistication, and depth of background . Though there is now a substantial literature on capital and technology flows, for instance, little work has yet been done on trade relationships, and much of this is not very accessible. Given these differences, readers will probably find some chapters more interesting than others and, like diners at a smorgasbord, try those that appear most appealing or relevant to their interests. This approach is used here for the same reasons, and also because space limitations prevent adequate treatment of all nine chapters. The chapter by EuI Yong Park, "An Analysis of the Trade Behavior of American and Japanese Firms in Korea," identifies foreign presence with foreign direct investment (FDI) and focuses on whether Japanese or American firms do more to promote Korea's exports. Park notes that FDI is not very large in Korea (less than 10 percent of foreign capital imports), is mainly in the form ofjoint ventures with Korean partners, is small scale, and can be found in a few laborintensive industries like textiles and apparel, electronics, musical instruments and toys, or in a few capital-intensive ones such as chemicals , petroleum refining, and machinery. Since Korea's comparative advantage until recently has been in labor-intensive production, and the government requires firms to export as a condition of entry for FDI in those industries where Korea has comparative advantage, "export propensity" (exports/total sales) of foreign firms should clearly be greater in labor-intensive than in capital-intensive industries . Kiyoshi Kojima, who examined characteristics of U.S. and Japanese FDI in several earlier articles, noticed that Japanese FDI was made mainly by small- and medium-sized labor-intensive firms, U.S. FDI by large, oligopolistic, capital-intensive firms, and concluded that Japanese FDI would augment host...