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A cost- benefit analysis of routes between the Trans-Korean and Trans-Siberian railways

손찬현|Anno Eremina
정석물류통상연구원 (Jungseok Research Institute of International Logistics and Trade)|2010.12|Journal of International Logistics and Trade|제8권 제2호|pp. 33-62|DOI 10.24006/jilt.2010.8.2.002

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참고문헌

키워드

Trans-Korean RailwayTrans-Siberian RailwayRoute Selection

초록

Recently the route connecting the trans-Korean railway and the trans-Siberian railway has become of particular interest for many academics and policy-makers in East Asian countries. The extensive review of previous studies, however, reveals that literature on the subject is lacking solid analytical framework. Most studies are one-sided, focusing on the political aspects of the issue or paying little attention to the economic aspects of the problem. This study intends to develop an analytical framework through which the most efficient route among four major alternative routes connecting the trans-Korean and trans-Siberian railways can be identified. It attempts to assign priorities to the four alternative routes according to their level of economic efficiency. This study utilizes a simple cost-benefit analysis in evaluating the four routes. Cost side,transportation time, effectiveness of customs procedures, and gauge difference are selected as the main economic factors. The volume of cargo, industrial production in adjacent regions, access to natural resources, and market size and foreign investment climate are used to evaluate the benefits of the routes. The study concludes that Route 3, which connects ‘Busan - Seoul (South Korea)– Pyongyang -Sinuiju (North Korea)– Shenyang– Beijing - Erenhot (China)– Ulaanbaatar (Mongolia)– Ulan-Ude -Moscow (Russia)’ is the most efficient route.

Abstract

Recently the route connecting the trans-Korean railway and the trans-Siberian railway has become of particular interest for many academics and policy-makers in East Asian countries. The extensive review of previous studies, however, reveals that literature on the subject is lacking solid analytical framework. Most studies are one-sided, focusing on the political aspects of the issue or paying little attention to the economic aspects of the problem. This study intends to develop an analytical framework through which the most efficient route among four major alternative routes connecting the trans-Korean and trans-Siberian railways can be identified. It attempts to assign priorities to the four alternative routes according to their level of economic efficiency. This study utilizes a simple cost-benefit analysis in evaluating the four routes. Cost side,transportation time, effectiveness of customs procedures, and gauge difference are selected as the main economic factors. The volume of cargo, industrial production in adjacent regions, access to natural resources, and market size and foreign investment climate are used to evaluate the benefits of the routes. The study concludes that Route 3, which connects ‘Busan - Seoul (South Korea)– Pyongyang -Sinuiju (North Korea)– Shenyang– Beijing - Erenhot (China)– Ulaanbaatar (Mongolia)– Ulan-Ude -Moscow (Russia)’ is the most efficient route.

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