Effects of the forest industry on the South Korean national economy: evidence from an Input-Output analysis based on the special classification for the forest industry

Abstract

Following the Fourth Industrial Revolution, the forest industry sector now combines cutting-edge technology with other industries. Hence, the Special Classification for the Forest Industry was established to clearly define the scope of the forest industry. Therefore, we reclassify the 2018 input-output table of the Bank of Korea based on the Special Classification of the Forest Industry. Specifically, we calculate the proportion of the forest industry that contributes to the products and services of each industry and divide them into forest and non-forest industry sectors to create the input-output table of the forest industry. We find that a direct and indirect production inducement effect of KRW 193.4 million occurs when KRW 100 million is invested in the forest industry. The import inducement coefficient is 0.221 and the value-added inducement coefficient is 0.779. In the labor sector, the total workers inducement coefficient is 12.9 and the employee inducement coefficient is 8.5.

Keywords

• Forest industry
• input-output analysis
• special classification
• disaggregating input-output tables
• inducement coefficients
• South Korean economy