Before World War Ⅱ, the Korean automobile industry did not exist at all. But in 1995 Korea ranked the fifth big country in terms of the automobile production in the world. And the automobile industry became one of the core industries in Korea. Therefore it is meaningful to study about the Korean automobile industry.
The purposes of this thesis are to study the demand function for passenger cars in Korea and to find some suggestions from the elasticity analysis of the demand funtions.
The major findings are as follows.
First, monthly receipts per household for salary and wage earners' households of all cities, the price of passenger cars and the price of gasoline are selected as the most suitable dependent valuables for passenger cars in Korea. Second, it is found that increase of passenger cars in Korea is mainly caused by an increase of income. Third, the raise of gasoline price may cause to transfer the potential demand from the midium-sized car to the small-sized car. Finally, it is found that midium-sized and large-sized car had a disposition of luxurious goods before 1990, but recently that disposition gradually disappeared by increasing income.
