Abstract
In the 1960s, about two decades after Japan’s economic takeoff, also South Korea underwent a period of extended growth and managed to rise to the ranks of high-income countries. This Chapter sheds light on the factors that enabled the “Miracle on the Han River”. It analyzes the South Korean export promotion strategy as well as the subsequent HCI drive (including the associated building up of macroeconomic imbalances), and the role that chaebols and industrial policies played in this context. In addition, the Chapter discusses why South Korea was hit so hard by the Asian Financial Crisis, which drastic (IMF imposed) reforms had to be undertaken, and in how far the economic situation and policy reactions differed during the Global Financial Crisis.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
South Korea first became a high-income country in 1993, then briefly lost its position after the 1997 financial crisis, and in 1999, it regained high-income status.
- 2.
For an overview of South Korea’s presidents between 1948 and 2020, see Table 3.2.
- 3.
The output share of mining increased from 1.08 to 2.25%.
- 4.
According to Jeon and Kim (2000), the tenancy rate declined from 52.4% in 1944 to 5.2% in 1955.
- 5.
However, such a rapid expansion of the educational system was also associated with problems such as overcrowded classrooms and double or even triple shifts in 40% of all classrooms (Lee 2008; Sorensen 1994). Therefore, some researchers argue that the rapid expansion came at the expense of quality (Lee 2012).
- 6.
See Park (2019) on synergy effects between land and educational reforms.
- 7.
Cf. Economic Planning Board (1961).
- 8.
As we will see, also throughout the subsequent 5-year plans, the policy course changed according to the varying economic conditions as well as changing views on the role of the government and markets (Park 2018).
- 9.
Regarding the main driver of the rapid export expansion in the 1960s, there are partly opposing views. Early studies in the 1970s argue that the development strategies switch from import substitution to export promotion in the middle of the 1960s and the less interventional trade policy as well as increased liberalization were the main reasons for increasing exports (Cole and Lyman 1971; Frank et al. 1975; Hong and Krueger 1975; Krueger 1979). In the late 1980s, economists began to increasingly underline the importance of industrial policy, including subsidies, tax incentives, and administrative support (cf. Rodrik 1995). More recently, the foreign exchange system reform of 1961 came more in the focus of research (see Yoo 2017).
- 10.
Cited in Lal (1986).
- 11.
Moreover, Taiwan had succeeded to mobilize savings and stabilize inflation after increasing the interest rates (Cho 1989).
- 12.
The third point of the Nixon doctrine states: “Third, in cases involving other types of aggression, we shall furnish military and economic assistance when requested in accordance with our treaty commitments. But we shall look to the nation directly threatened to assume the primary responsibility of providing the manpower for its defense”.
- 13.
However, Lane (2019) finds that while South Korea’s HCI policy positively impacted forward-linked industries it negatively impacted backward-linked industries.
- 14.
- 15.
The import liberalization ratio is defined as the automatic approval items divided by the total number of commodity class.
- 16.
According to Collins and Park (1989), this opportunity was “good fortune”.
- 17.
According to Sakong and Koh (2010), the ZBB most likely also had an announcement effect.
- 18.
Namely 98.6%, cf. Kim and Seong (1997).
- 19.
Nam (1993) reports even lower levels for the 1980s (23.7% for 1983 and 19.3% for 1987).
- 20.
However, the strong yen also led to an increase in the prices of capital imports from Japan for South Korean companies, which, in general, had a negative effect on the current account balance. As shown in the data, the positive effect of the yen appreciation outweighed the adverse impacts (Cho 1995).
- 21.
Perkins (1997) distinguishes between four phases of economic policy experience. While the first two phases are marked by President Park, the third phase with the election of President Roh in 1987 and President Kim in 1993 are the cornerstones for the fourth phase of increasing democracy. However, as Perkins (1997) notes, the increasing democratic influence was based on reform ideas that were already developed in the previous phase.
- 22.
An excellent overview of the most important financial liberalization measures during the 1990s is provided by Chang et al. (1998: 737, Table 1).
- 23.
Among others, Australia, Britain, Canada, France, and Germany.
- 24.
Cf. New York Times (1997) 04.12.1997.
- 25.
Lee (1999b) reports that the call rate was first raised by 8.4 percentage points between the 1st and 3rd December 1997 (from 12.3 to 20.7%). On the 23rd of December, it then further increased to 30.1%.
- 26.
However, this policy was subsequently reversed and the South Korean government was allowed to maintain a budget deficit of up to 0.8% of GDP (Shin and Chang 2003).
- 27.
These guarantees are also referred to as cross-debt guarantees. One affiliate guarantees to pay back the debt of another affiliate in case that this affiliate is not able to repay the debt on its own (Graham 2003a).
- 28.
Six swaps of businesses among the chaebols that were actually implemented included (1) the annexation of Kia motors by Hyundai motors, (2) the takeover of Samsung motors by Renault, (3) the merging of Aerospace portions of Hyundai, Samsung and Daewoo into the Korea Aerospace Industries, (4) Semiconductor portion of LG went to Hyundai, (4) the takeover of power components of Samsung Heavy Industries and Hyundai industries by Korea Heavy Industries and Construction (Hanjung) (cf. Heo and Woo 2006).
- 29.
That is, this debt was not subject to any repayment burden.
- 30.
The increasing presence of foreign bank branches was the consequence of the liberalization measures installed after the Asian Financial Crisis (see also Sect. 3.9.3.2).
- 31.
Please note that all information on the number of firms assigned to each grade is obtained from Koo (2011).
Abbreviations
- ADB:
-
Asian Development Bank
- AFC:
-
Asian Financial Crisis
- ASEAN:
-
Association of South East Asian Nations
- BIS:
-
Bank of International Settlements
- CD:
-
Certificate of Deposit
- CDMA:
-
Code Division Multiple Access
- CDO:
-
Collateralized Debt Obligation
- CESP:
-
Comprehensive Economic Stabilization Program
- CMO:
-
Collateralized Mortgage Obligation
- CPI:
-
Consumer Price Index
- ED Plan:
-
Economic Development Plan
- EPB:
-
Economic Planning Board
- EXR:
-
Exchange Rate
- FDI:
-
Foreign Direct Investment
- FI:
-
Financial Institution
- FR:
-
Foreign Reserves
- FSC:
-
Financial Supervisory Commission
- FSS:
-
Financial Supervisory Service
- GDP:
-
Gross Domestic Product
- GFC:
-
Global Financial Crisis
- GNI:
-
Gross National Income
- GNP:
-
Gross National Product
- HAN:
-
Highly Advanced National R&D
- HCI:
-
Heavy and Chemical Industry
- HDTV:
-
High Definition Television
- IBTDP:
-
Industrial Base Technology Development Project
- ICT:
-
Information and Communication Technology
- IFS:
-
International Financial Statistics
- ILO:
-
International Labor Organization
- IMF:
-
International Monetary Fund
- ISI:
-
Import Substitution Industrialization
- KAIST:
-
Korea Advanced Institute for Science and Technology
- KAMCO:
-
Korea Asset Management Corporation
- KDI:
-
Korean Development Institute
- KDIC:
-
Korea Deposit Insurance Corporation
- KIST:
-
Korea Institute of Science and Technology
- LTD:
-
Loan-to-Deposit Ratio
- M&A:
-
Merger and Acquisition
- M2:
-
Money Supply 2
- M3:
-
Money Supply 3
- MBS:
-
Mortgage Backed Securities
- MIC:
-
Ministry of Information and Communication
- MOFE:
-
Ministry of Finance and Economy
- MOU:
-
Memorandum of Understanding
- NBFI:
-
Non-Bank Financial Institution
- NIF:
-
National Investment Fund
- NPL:
-
Non-Performing Loan
- NRP:
-
National R&D Project
- OECD:
-
Organisation for Economic Co-operation and Development
- OPEC:
-
Organization of the Petroleum Exporting Countries
- POSCO:
-
Pohang Iron and Steel Company
- R&D:
-
Research and Development
- SME:
-
Small and Medium-Sized Enterprise
- SOE:
-
State-Owned Enterprise
- SSA:
-
Sub-Saharan Africa
- TFP:
-
Total Factor Productivity
- USA:
-
United States of America
- WDI:
-
World Development Indicators
- ZBB:
-
Zero-Based Budgeting
References
Adelman I (1997) Social development in Korea, 1953–1993. In: Cha DS, Kim KS, Perkins DH (eds) The Korean economy 1945–1995: performance and vision for the 21st century. Korea Development Institute, Seoul, pp 509–540
Ahmad J (1978) Import substitution—a survey of policy issues. Dev Econ 16(4):355–372. https://doi.org/10.1111/j.1746-1049.1978.tb01070.x
Ahn CY (1990) Recent economic transition of South Korea: comparative perspectives with Latin America. J Econ Dev 15:27–46
Ahn CY, Kim J-H (1997) The output-looking trade policy and the industrial development of South Korea. In: Cha D-S, Kim KS, Perkins DH (eds) The Korean economy 1945–1995: performance and vision for the 21st century. Korea Development Institute, Seoul, pp 339–382
Aizenman J, Jinjarak Y, Park D (2011) Evaluating Asian swap arrangement. ADBI Working Paper 297, Asian Development Bank Institute, Tokyo
Amsden A (1989) Asia’s next giant: South Korea and late industrialization. Oxford University Press, New York
Asian Development Bank (2020) Asia’s journey to prosperity: policy, market, and technology over 50 years. Asian Development Bank, Manila
Baer W (1984) Industrialization in Latin America: successes and failures. J Econ Educ 15(2):124–135
Baldwin F (1975) America’s rented troops: South Koreans in Vietnam. Bull Concern Asian Sch 7(4):33–40. https://doi.org/10.1080/14672715.1975.10406389
Bank of Korea (2002) Monetary policy in Korea. Bank of Korea, Seoul
Bank of Korea (n.d.) From the Second Currency Reform in 1953 to Third Currency Reform in 1962. Bank of Korea, Seoul. https://www.bok.or.kr/eng/main/contents.do?menuNo=400117
Baudino P, Yun H (2017) Resolution of non-performing loans-policy options. FSI Insights on Policy Implementation No 3, Bank for International Settlements, Basel
Castley RJQ (2006) The role of Japan in Korea’s acquisition of technology. Asia Pac Bus Rev 3(1):29–53
Chang H-J (1998) Korea: the misunderstood crisis. World Development 26(8):1555–1561
Chang H, Park H, Yoo CG (1998) Interpreting the Korean crisis: financial liberalization, industrial policy and corporate governance. Camb J Econ 22(6):735–746
Chibber V (1999) Building a developmental state: the Korean case reconsidered. Polit Soc 27(3):309–346
Cho D (2009) The Republic of Korea’s economy in the swirl of global crisis. ADBI Working Paper 147, Asian Development Bank Institute, Tokyo
Cho D, Kang Y (2013) 2012 modularization of Korea’s development experience: Korea stabilization policies in the 1980s. Ministry of Strategy and Finance, Sejong, KDI School of Public Policy and Management, Sejong
Cho H (2012) Korea’s experience with global financial crisis. The North-South Institute, Ottawa
Cho JH (1995) External debt and policy controversy in Korea. South Econ J 62(2):467–480
Cho S (1994) The dynamics of Korean economic development. Institute for International Economics, Washington
Cho YJ (1989) Finance and development: the Korean approach. Oxford Rev Econ Policy 5(4):88–102
Cho YJ (2002a) Financial repression, liberalization, crisis and restructuring: lessons of Korea’s financial sector policies. ADB Institute Research Paper 47, Asian Development Bank Institute, Tokyo
Cho YJ (2002b) The political economy of financial liberalization in South Korea. In: Lee CH (ed) Financial liberalization and the economic crisis in Asia. Routledge, London, pp 82–103
Cho YJ, Kim JK (1997) Credit policies and the industrialization of Korea. Korea Development Institute (KDI), Seoul
Cho YJ, McCauley RN (2003) Liberalising the capital account without losing balance: lessons from Korea. In: China’s capital account liberalisation: international perspectives. BIS Working Paper 15, Bank for International Settlements, Basel, pp 75–92
Choi S, Dyck J, Childs N (2016) The rice market in South Korea. USDA Rice Outlook RCS-16I-01, United States Department of Agriculture, Economic Research Service, Washington DC
Chopra A, Lang K, Karasulu M et al (2001) From crisis to recovery in Korea: strategy, achievements, and lessons. IMF Working Paper No 01/154, International Monetary Fund, Washington DC
Chung HC (2009) The Bank of Korea’s policy response to the global financial crisis. BIS Papers 54, Bank of International settlement, Basel
Clifford ML (1994) Troubled tiger: business, bureaucrats & generals in South Korea. M.E. Sharpe, Armonc NY
Coe DT, Kim S (eds) (2002) Korean crisis and recovery. International Monetary Fund, Korea Institute for International Economic Policy, Washington DC
Cole D, Park YC (1983) Financial development in Korea, 1945–1978. Harvard University Press, Cambridge
Cole DC, Lyman PN (1971) Korean development: the interplay of politics and economics. Harvard University Press, Cambridge
Collins SM, Park W (1989) External debt and macroeconomic performance in South Korea. In: Sachs JD (ed) Developing country debt and the World economy. University of Chicago Press, Chicago IL
Corbo V, Nam SW (1988) Korea’s macroeconomic prospects and policy issues for the next decade. World Dev 16:35–45
Dalla I, Khatkhate D (1995) Regulated deregulation of the financial system in Korea, World Bank Discussion Paper 292. World Bank, Washington DC
Economic Planning Board (1961) The first 5-year economic development plan 1962–1966 (in Korean). Economic Planning Board, Seoul
Frank, CR, Kim KS, Westphal LE (1975) Foreign trade regimes and economic development. NBER, South Korea, New York
Fukuyama, F (2012) China and East Asian democracy the patents of history. Journal of Democracy 23(1):14–26
Galbraith JK, Kim J (1998) The legacy of the HCI: an empirical analysis of Korean industrial policy. J Econ Dev 23:1–20
Garz D (2015) Going away. Going home! Coming home? The migration of Korean nurses and miners to Germany and their return in retirement to Korea’s German village—together with their German husbands. OMNES: J Multicult Soc 6(1):161–183. https://doi.org/10.15685/omnes.2015.07.6.1.161
Glawe L, Wagner H (2016) The middle-income trap - definitions, theories and countries concerned: a literature survey. Comp Econ Stud 58(4):507–538
Gon CS, Gyun PT (2013) Suggestions for new perspectives on the land reform in South Korea. Seoul J Korean Stud 26(1):1–21
Graham EM (2003a) The miracle with a dark side: Korean economic development under Park Chung–hee. In: Reforming Korea’s industrial conglomerate. Peterson Institute for International Economics, Washington DC
Graham EM (2003b) The 1997–98 crisis and its aftermath. In: Reforming Korea’s industrial conglomerate. Peterson Institute for International Economics, Washington DC
Haggard S, Kim B-K, Moon C-I (1991) The transition to export-led growth in South Korea: 1954–1966. J Asian Stud 50(4):850–873. https://doi.org/10.2307/2058544
Haggard S, Pinkston D, Seo J (1999) Reforming Korea Inc.: the politics of structural adjustments under Kim Dae Jung. Asian Perspect 23(3):201–235
Hamilton N, Kim EM (1993) Economic and political liberalisation in South Korea and Mexico. Third World Q 14:109–136
Han S-J (1974) The failure of democracy in South Korea. University of California Press, Berkeley
Harbison FH, Myers CS (1964) Education, manpower, and economic growth. McGraw-Hill, New York
Harris L (1987) Financial reform and economic growth: a new interpretation of South Korea’s experience. In: Harris L et al (eds) New perspectives on the financial system. Croom Helm, London
Heo U, Woo J-Y (2006) South Korea’s experience with structural reform: lessons for other countries. Korean Soc Sci J 33:1–24
Hill H (1996) Indonesia’s industrial policy and performance: “orthodoxy” vindicated. Econ Dev Cult Change 45(1):147–174
Hirschman AO (1958) The strategy of economic development. Yale University Press, New Haven
Hong W, Krueger AO (eds) (1975) Trade and development in Korea. Korea Development Institute, Seoul
Horikane Y (2005) The political economy of heavy industrialisation: the heavy and chemical industry (HCI) push in South Korea in the 1970s. Mod Asian Stud 39(2):369–397
Hundt D (2008) Korea’s developmental alliance: state, capital and the politics of rapid development. Routledge
Hwang E-G (1993) The Korean economies; a comparison of north and south. Clarendon Press, Oxford
ILO (2012) Republic of Korea—development of national employment policies through two economic crises: lessons from its experiences. International Labour Office, Geneva
IMF (2000a) Recovery from the Asian crisis and the role of the IMF. International Monetary Fund, Washington DC. https://www.imf.org/external/np/exr/ib/2000/062300.htm#box2
IMF (2000b) Republic of Korea: economic and policy developments. IMF Staff Country Report No 00/11, International Monetary Fund, Washington DC
IMF (2021) International financial statistics. https://data.imf.org/?sk=4c514d48-b6ba-49ed-8ab9-52b0c1a0179b
Jeon BN (2012) from the 1997–98 Asian financial crisis to the 2008–09 global economic crisis: lessons from Korea’s experience. MPRA Working Paper 36469
Jeon Y-D, Kim Y-Y (2000) Land reform, income redistribution, and agricultural production in Korea. Econ Dev Cult Change 48(2):253–268
Jones LP, Sakong I (1980) Government, business, and entrepreneurship in economic development: the Korean case. Harvard University Press, Cambridge, MA
Jung J, Mah JS (2013) R&D policies of Korea and their implications for developing countries. Sci Technol Soc 18(2):165–188. https://doi.org/10.1177/0971721813489435
Kang K, Lee Y, Choi S (2008) Korean policymaking systems during the rapid development period: Economic Planning Board and policy implementation. Korean Development Institute, Seoul
Kang TW (1989) Is Korea the next Japan?: understanding the structure, strategy, and tactics of America’s next competitor. The Free Press, New York
Kang G-H (2000) Five year economic development plan (in Korean). Seoul University Press, Seoul
Kihwan K (2006) The 1997–98 Korean financial crisis: causes, policy response, and lessons. Paper presented at the high level seminar on crisis prevention in emerging markets, International Monetary Fund and The Government of Singapore, Singapore, 10–11 June 2006
Kim C, Shin I (2003) Economic liberalization of Korea for an advanced market economy. Working Paper 2003-03, Korea Development Institute, Seoul
Kim D (2002) The Korean labor market: the crisis and after. In: Coe DT, Kim S-J (eds) Korean crisis and recovery. International Monetary Fund, Washington DC, Korea Institute for International Economic Policy, Seoul, pp. 261–292
Kim DK, Seong HW (1997) Science and technology: public policy and private strategy. In: Cha D-S, Kim KS, Perkins DH (eds) The Korean economy 1945–1995: performance and vision for the 21st century. Korea Development Institute, Seoul, pp 383–425
Kim H-B, Lee CH (2006) Financial reform, institutional interdependency, and supervisory failure in postcrisis Korea. J East Asian Stud 6(3):409–431
Kim I (2016) Land reform in South Korea under the U.S. military occupation, 1945–1948. J Cold War Stud 18(2):97–129. https://doi.org/10.1162/JCWS_a_00639
Kim JD, Wang Y (1996) Toward liberalisation of international direct investment in Korea: retrospects and prospects. KIEP Working Paper, No 96-02, Korea Institute for International Economic Policy, Seoul
Kim JH (1990) Korean industrial policy in the 1970’s: the heavy and chemical industry drive. Korea Development Institute, Seoul
Kim J-K (1998a) Debt and financial instability in Korea. ERI Working Paper No 69, Economic and Social Research Institute, Tokyo
Kim K (1998b) Technology transfer: the case of the Korean electronics industry. Paper presented at the thirty-first Hawaii international conference on system sciences, Kohala Coast, HI, 9 January 1998. https://doi.org/10.1109/HICSS.1998.654779
Kim KM (2020) The Korean development state. Palgrave Macmillan, Singapore
Kim KS (1991) The Korean miracle (1962–1980) revisited: myths and realities in strategy and development. Kellogg Institute Working Paper 166, University of Notre Dame, Helen Kellogg Institute for International Studies, Notre Dame IN
Kim KS (2000) The 1997 financial crisis and governance: the case of South Korea. Kellogg Institute Working Paper 272, University of Notre Dame, Helen Kellogg Institute for International Studies, Notre Dame IN
Kim K-S, Park J-K (1985) Sources of economic growth in Korea: 1963–1982. Korea Development Institute, Sejong City
Kim KS, Roemer M (1979) Growth and structural transformation. Harvard University Council on East Asian Studies, Cambridge, MA
Kim L (1993) National system of industrial innovation: dynamics of capability building in Korea. In: Nelson J (ed) National innovation and technology learning
Kim P-J (1997) Financial policies and evolution. In: Cha D-S, Kim KS, Perkins DH (eds) The Korean economy 1945–1995: performance and vision for the 21st century. Korea Development Institute, Seoul, pp 186–237
Kim Q-Y (1983) The fall of Syngman Rhee. Institute of East Asian Studies, Korea Research Monograph #7, University of California, Berkeley
Kim S, Lee J-H (1997) Industrial relations and human resource development. In: Cha D-S, Kim KS, Perkins DH (eds) The Korean economy 1945–1995: performance and vision for the 21st century. Korea Development Institute, Seoul, pp 586–622
Kim S, Lee J-H (2002) The secondary school equalization policy in South Korea. Unpublished Working Paper, University of Wisconsin-Milwaukee, W and KDI School of Public Policy and Management, Seoul
Kim SJ (1970) South Korea’s involvement in Vietnam and its economic and political impact. Asian Surv 10(6):519–532. https://doi.org/10.2307/2642884. https://www.jstor.org/stable/2642884
Kim SK, Kim J-K (1997) Korean economic development: an overview. In: Cha D-S, Kim KS, Perkins DH (eds) The Korean economy 1945–1995: performance and vision for the 21st century. Korea Development Institute, Seoul, pp 3–56
Kim S-M, Kim J-Y, Ryoo H-T (2006) Restructuring and reforms in the Korean banking industry. In: BIS (ed) The banking system in emerging economies: how much progress has been made? Bank for International Settlements, Basel, BIS Papers No 28, pp 259–68
Kim ST (2010) Korea’s unemployment insurance in the 1998 Asian financial crisis and adjustments in the 2008 global financial crisis. ABDI Working Paper No 214, Asian Development Bank Institute, Tokyo
Kim Y-S (1992) Korea’s technology policy for industrialization: imported technology for economic development. Korea J Popul Dev 21:85–98
Koener P, Maass G, Siebold T, Tetzlaff R (1986) The IMF and the debt crisis: a guide to the Third World’s dilemma. Zed Books, London
Koo J-H (2011) corporate restructuring in Korea following the global financial crisis. Wkly Financ Rev 20(10):1–10
Krause LB (1997) The political economy of South Korea: 50 years of macroeconomic management, 1945–1995. In: Cha D-S, Kim KS, Perkins DH (eds) The Korean economy 1945–1995: performance and vision for the 21st century. Korea Development Institute, Seoul, pp 101–142
Krueger AO (1979) The developmental role of the foreign sector and aid. Council on East Asian studies. Harvard University, Cambridge, MA
Krueger AO (1977) Growth, distortions and patterns of trade among many countries. Princeton Studies in International Finance, no. 40. International Finance Section, Dept. of Economics, Princeton University, Princeton
Krueger AO (1982) Comparative advantage and development policy 20 years later. IUI Working Paper No 65, The Research Institute of Industrial Economics (IUI), Stockholm
Krueger AO (1997) Trade policy and economic development: how we learn. Am Econ Rev 87(1):1–22
Krueger AO, Yoo J (2002) Chaebol capitalism and the currency-financial crisis in Korea. In: Edwards S, Frankel JA (eds) Preventing currency crises in emerging markets. University of Chicago Press, Chicago
Kwack S (2000) Total factor productivity growth and the source of growth in Korean manufacturing industries, 1971–1993. J Korean Econ 1(2):229–265
Kwack T (1984) Industrial restructuring experience and policies in Korea in the 1970s. KDI Working Paper 84-08, Korea Development Institute, Sejong-City
Kwack T-W (1985) Depreciation allowance and capital income taxation (in Korean). Korea Development Institute, Seoul
Kwon O-K (2016) Corporate restructuring in Korea. Korea Development Institute, Sejong City
Kwon OY (1998) The Korean financial crisis: diagnosis, remedies and prospects. J Asia Pac Econ 3(3):331–357. https://doi.org/10.1080/13547869808724656
Lal D (1986) Ideology and Industrialization in India and East Asia. Development Research Department Report 218, World Bank, Washington DC. https://documents1.worldbank.org/curated/en/593101468266445242/text/DRD21800Box37700India0and0East0Asia.txt
Lane N (2019) Manufacturing revolutions—industrial policy and industrialization in South Korea. Working Paper. https://nathanlane.github.io/assets/papers/ManufacturingRevolutions_Lane_Live.pdf (author’s homepage). A summary is available at VoxDev. https://voxdev.org/topic/firms-trade/manufacturing-revolutions-role-industrial-policy-south-korea-s-industrialisation
Lee B-C (1999a) Park Chung-hee administration and a developing country model formation (in Korean). J Korean Econ Dev 5(2):141–187
Lee CH, Lee K, Lee K (2000) Chaebol, financial liberalization, and economic crisis: transformation of quasi-internal organization in Korea. Working Papers 200004, University of Hawaii at Manoa, Department of Economics, Honolulu HI
Lee CJ (2008) Education in the Republic of Korea: approaches, achievements, and current challenges. In: Fredricksen B, Tan JP (eds) An African exploration of the East Asian education experiences. World Bank, Washington DC, pp 157–217
Lee CJ, Kim Y, Byun S-Y (2012a) The rise of Korean education from the ashes of the Korean War. Prospects 42:303–318. https://doi.org/10.1007/s11125-012-9239-5
Lee D, Sohn C-K, Kim Y-Q (1984) Recent developments of financial system in Korea. Economic Research Institute Discussion Paper 30, Economic Planning Agency, Tokyo
Lee J (1996) Government interventions and productivity growth. Journal of Economic Growth 1(3):391–414
Lee H, Rhee C (2012) Lessons from the 1997 and the 2008 crisis in the Republic of Korea. ADB Working Paper 298, Asian Development Bank, Manila
Lee H-H (1999b) Korea’s 1997 financial crisis: causes, consequences, and prospects. Agenda: J Policy Anal Reform 6(4):351–363
Lee J-W (2017a) Twenty years after the financial crisis in the Republic of Korea. ADBI Working Paper 790, Asian Development Bank Institute, Tokyo
Lee J, Yi D (2018) Still a new democracy? Individual-level effects of social trust on political trust in South Korea. Asian Journal of Political Science 26(2):201–220
Lee J-W, Rhee C (2007) Crisis and recovery: what we have learned from the South Korean experience? Asian Econ Policy Rev 2:146–164. https://doi.org/10.1111/j.1748-3131.2007.00061.x
Lee K, Kim B-K, Lee CH et al (2005) Visible success and invisible failure in post-crisis reform in the Republic of Korea: interplay of global standards, agents, and local specificity. World Bank Policy Research Paper 3651, World Bank, Washington DC
Lee K-S (2017b) The Korean financial crisis of 1997: onset, turnaround, and thereafter. World Bank, Korea Development Institute, Washington DC, Seoul
Lee S, Kim S, Han S-H (1989) Industrial policy of Korea (in Korean). Korea Institute for Industrial Economics and Trade, Seoul
Lee S-C (1991) The heavy and chemical industries promotion plan (1973–1979). In: Cho L-J, Kim YH (eds) Economic development in the Republic of Korea: a policy perspective, chapter 17. East-West Center, University of Hawaii Press, Honolulu, Hawaii, pp 431–471
Lee Y (2005) Participatory democracy and Chaebol regulation in Korea: state-market relations under the MDP governments, 1997–2003. Asian Surv 45(2):279–301
Leiteritz RJ (2014) Capital account policy in South Korea: the informal residues of the development state. Colomb Int 83:235–265. https://doi.org/10.7440/colombiaint83.2015.09
Lew, SC (2013) Confucian Capitalism of Park Chung Hee: possibilities and limits. In: Lew SC (ed) The Korean economic developmental path. Palgrave Macmillan, New York. https://doi.org/10.1057/9781137347299_5
Lie J (1998) Han unbound: the political economy of South Korea. Stanford University Press, Stanford CA
Lim U (2001) Ownership structure and family control in Korean conglomerates. In: Choi JJ (ed) Asian financial crisis financial, structural and international dimensions (International Finance Review, Vol. 1). Emerald Group Publishing Limited, Bingley, pp 379–410. https://doi.org/10.1016/S1569-3767(00)01016-5
Lim W (2010) Corporate restructuring in post-crisis Korea. Ministry of Strategy and Finance, Republic of Korea and Korea Development Institute, Seoul
Lim W (2012) Chaebol and industrial policy in Korea. Asian Econ Policy Rev 7:69–86. https://doi.org/10.1111/j.1748-3131.2012.01218.x
Lim W, Hahm J-H (2006) Turning a crisis into an opportunity: the political economy of Korea’s financial sector reform. In: Mo J, Okimoto DI (eds) From crisis to opportunity: financial globalization and East Asian capitalism. Walter H. Shorenstein Asia Pacific Research Center, Stanford CA, pp 83–120
Lone SP, McCormack G (1994) Korea since 1850. Longman, Melbourne, Australia
Luedde-Neurath R (1986) State intervention and export-oriented development: a reassessment of the South Korean case. Westview Press, Boulder CO
Mah JS (2007) Industrial policy and economic development: Korea’s experience. J Econ Iss 41:77–92
McKinnon R (1973) Money and capital in economic development. The Brookings Institute, Washington
Mitchell CC (1949) Land reforms in South Korea. Pac Aff 22(2):144–154
Mo J, Moon C-I (2003) Business-government relations under Kim Dae-jung. In: Haggard S, Wonhyuk Lim W, Kim E (eds) Economic crisis and corporate restructuring in Korea. Cambridge University Press, New York, pp 127–149
Mohr B, Wagner H (2012) Regulatory governance and the framework for safeguarding financial stability. In: Tavidze A (ed) Progress in economics research, vol 23. Nova Science Publishers, New York, pp 1–32
Mohr B, Wagner H (2013) A structural approach to financial stability: on the benefical role of regulatory governance. J Gov Regul 2(1):7–26
Moon PY, Sul KE (1997) Agricultural policies and development. In: Cha D-S, Kim KS, Perkins DH (eds) The Korean economy 1945–1995: performance and vision for the 21st century. Korea Development Institute, Seoul, pp 468–508
Morck R, Nakamura M (2007) Business groups and the big push: Meiji Japan’s mass privatization and subsequent growth. Enterp Soc 8(3):543–601
Morck R, Yeung B (2017) East Asian Financial and Economic Development. NBER Working Paper 23845, National Bureau of Economic Research, Cambridge, MA
Nam C-H (1993) The role of trade and exchange rate policy in Korea’s growth. In: Ito T, Krueger AO (eds) Growth theories in light of the East Asian experience. University of Chicago Press, pp 153–179
Nam S, Kim J-I (1997) Macroeconomic policies and evolution. In: Cha D-S, Kim KS, Perkins DH (eds) The Korean economy 1945–1995: performance and vision for the 21st century. Korea Development Institute, Seoul, pp 143–185.
New York Times (1997) Crisis in South Korea: The Bailout; Package of Loans Worth $55 billion is set for Korea (04.12.1997)
Nicolas F, Thomsen S, Bang M-H (2013) Lessons from Investment Policy Reform in Korea. OECD Working Papers on International Investment 2013/02, OECD Publishing, Paris. https://doi.org/10.1787/5k4376zqcpf1-en
Noland M (2004). Selective intervention and growth: the case of Korea. Working Paper Series WP04-3, Peterson Institute for International Economics
Noland M, Pack H (2003) Industrial policy in an era of globalization: lessons from Asia. Peterson Institute for International Economics, Washington DC
Pak KH (1956) Outcome of land reform in the Republic of Korea. J Farm Econ 38(4):1015–1023
Park J-D (2019b) The essence of the Korean model of development. In: Park J-D (ed) Re-inventing Africa’s development. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-03946-2
Park S-J (2013) Development state in Korea (60–70ties) revisited: institution-building for the making of ‘coordinated market’. Ordnungspolitische Diskurse 2013-2, Ordnungspolitisches Portal (OPO)
Park Y (2018) Modern Korean economy 1948–2008. The Academy of Korean Studies, Seongnam
Park YC (1984) Korea’s experience with industrial adjustment in the 1970’s: promotion of heavy and chemical industries. Paper presented at the International Forum on Industrialization and Urban-Rural Linkages, Seoul, 16–25 October 1984
Park YC (1986) Foreign debt, balance of payments, and growth prospects: the case of the Republic of Korea, 1965–88. World Dev 14(8):1019–1058
Park Y-K (2005) Structural changes and the drive to heavy and chemical industry. In: Lee D (ed) New Korean economic history: from the late Joseon period to the high growth period of the 20th century (in Korean), Seoul, pp 403–428
Pecotich A, Shultz CJ (2006) Handbook of markets and economies: East Asia, Southeast Asia, Australia, New Zealand. Routledge, London
Perkins DH (1997) Structural transformation and the role of the state: Korea, 1945–1995. In: Cha DS, Kim KS, Perkins DH (eds) The Korean economy 1945–1995: performance and vision for the 21st century, Chapter 12. Korea Development Institute, Seoul, pp 57–98
Radelet S, Sachs J, Cooper RN et al (1998) The East Asian financial crisis: diagnosis, remedies, prospects. Brook Papers Econ Activity 1:1–90
Radelet S, Sachs J, Lee J-W (1997) Economic growth in Asia. Harvard Institute for International Development, Cambridge, MA
Rhee S (1987) Policy reforms of the eighties and industrial adjustments in Korean economy. KDI Working Paper 8708, Korea Development Institute, Seoul
Rodrik D (1995) Getting interventions right: how South Korea and Taiwan grew rich. Econ Policy 10(20):55–107
Roemer, M (1994) Industrial strategies: outward bound. In: Lindauer DL, Roemer M (eds) Asia and Africa: legacies and opportunities in development. Institute for Contemporary Studies Press, San Francisco
Rosenstein-Rodan PN (1943) Problems of industrialisation of Eastern and South-Eastern Europe. Econ J 53(210/211):202–211
SaKong I (1993) Korea in the world economy. Institute for International Economics, Washington DC
Sakong I, Koh Y (eds) (2010) The Korean economy: six decades of growth and development. Korea Development Institute, Seoul
Seth MJ (2017) South Korea’s economic development, 1948–1996. Oxford research encyclopedias. Asian Hist. https://doi.org/10.1093/acrefore/9780190277727.013.271
Shaw E (1973) Financial deepening in economic development. Oxford University, New York
Shim U-S (2015) South Korean workers and the Middle East construction boom in the 1970s. J Contemp Korean Stud 2(1):37–56
Shin J-S, Chang H-J (2003) Restructuring Korea Inc. Routledge Curzon, London
Shin Y-H (1976) Land reform in Korea, 1950. Bull Popul Dev Stud Center 5:14–31
Sorensen CW (1994) Success and education in South Korea. Comp Educ Preview 38:10–35
Sta. Romana LL (2014) Some lessons from Korea’s industrialization strategy and experience. MPRA Paper No 58250, Munich Personal RePEc Archive, Munich
Stern J, Kim JH, Perkins DH (1995) Industrialization and the state: the Korean heavy and chemical industry drive. Harvard University Press
Suh S (2007) The influence of foreigners’ stock investment on Korean stock prices and its implications. Bank Korea Econ Papers 9(2):123–161. Bank of Korea, Seoul
Tsutsumi M, Jones RS, Cargill TF (2010) The Korean financial system: overcoming the global financial crisis and addressing remaining problems. OECD Economics Department Working Papers 796, OECD, Paris
Wagner H (2010) The causes of the recent financial crisis and the role of central banks in avoiding the next one. Int Econ Econ Policy 7(1):63–82
World Bank (2021) World development indicators. The World Bank, Washington, DC. https://data.worldbank.org/products/wdi
Yang J-J (2006) Corporate unionism and labor market flexibility in South Korea. J East Asian Stud 6(2):205–231
Yeon J-I, Pyka A, Kim T-Y (2016) Structural shift and increasing variety in Korea, 1960–2010: empirical evidence of the economic development model by the creation of new sectors. Hohenheim Discussion Papers in Business, Economics and Social Sciences, No 12-2016, Universität Hohenheim, Stuttgart
Yoo J (1989) The Korean experience with industrial targeting policy. Korea Institute for International Economic Policy, Seoul
Yoo J (2017) Korea’s rapid export expansion in the 1960s: how it began. KDI. J Econ Policy 39(2):1–23. https://doi.org/10.23895/kdijep.2017.39.2.1
Yoo, J (1990) The industrial policy of the 1970s and the evolution of the manufacturing sector in Korea. KDI Working Paper No. 9017, Korean Development Institute, Seoul
Yoo J (1991) The effect of heavy and chemical industry policy of the 1970s on the capital efficiency and export competitiveness of Korean manufacturing Industries (in Korean). Korea Dev Rev 13(1):65–113
Yoon DR (2011) The Korean economic adjustment to the worst financial crisis. Asian Econ Papers 10(1):106–127
Yoon J-H (2006) Korean technology policy (in Korean). KyungMun Publishing, Seoul
Zeile W (1991) Industrial targeting through government rationing: the Korean experience in the 1970s. Program in East Asian Culture and Development Research Working Paper Series, No. 41. Institute of Government Affairs, University of California, Davis CA
Author information
Authors and Affiliations
Corresponding author
Appendix
Appendix
See Table 3.10.
Rights and permissions
Copyright information
© 2021 The Author(s), under exclusive license to Springer Nature Switzerland AG
About this chapter
Cite this chapter
Glawe, L., Wagner, H. (2021). South Korea’s Catching-Up Process. In: The Economic Rise of East Asia. Contributions to Economics. Springer, Cham. https://doi.org/10.1007/978-3-030-87128-4_3
Download citation
DOI: https://doi.org/10.1007/978-3-030-87128-4_3
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-030-87127-7
Online ISBN: 978-3-030-87128-4
eBook Packages: Economics and FinanceEconomics and Finance (R0)