Authors: Tae-jin Kim (Kyungpook National University), Jungu Kang (Korea Institute for International Economic Policy), Seung-jin Shim (Kyungpook National University)

The purpose of this study is to analyze the impact of Brexit on Korea's industrial economy. When the UK leaves the European Union (EU), we consider two highly realizable Brexit scenarios that can influence changes in Korea's commodity trade policy. We use the latest World Input-Output Table (WIOT) in the World Input-Output Database to investigate the economic effects of each Brexit scenario on Korea’s industrial economy. Notably, unlike previous studies, we analyze changes in global value chains of Korean industries and conduct the factor decomposition analysis of changes in GDP by industry after Brexit. Based on the empirical results, we discuss meaningful implications for changes in Korea's commodity trade policy for each of Brexit's scenarios.