Reforming Korea's Industrial Conglomeratesby Edward M. M. Graham
Pub. Date: 01/20/2003
Publisher: Peterson Institute for International Economics
When Korea became enveloped in the Asian financial crisis that broke out in 1997, one causal factor was the high level of debt and low rate of returns being achieved by most of Korea's large industrial conglomerates-the chaebol. Accordingly, both IMF conditions for assistance to Korea after the crisis and the agenda of then-newly elected Korea President Kim Dae-jung called for major reform of the way these groups were structured, financed, and governed. However, pressures to reform the chaebol have existed intermittently throughout the period of the "Korean economic miracle" that began in the 1960s, and they continue even to this day.This book examines the history of the chaebol and their role in creating the "economic miracle" as well as the role that they played in bringing about the 1997 crisis in Korea. Author Edward M. Graham argues that, while substantial reform has been accomplished both within the chaebol and in the Korean economy as a whole, the process is far from complete. Indeed, weaknesses within the industrial groups of Korea persist that could cloud Korea's economic future, despite the impressive rebound that the Korean economy has experienced since 1998. Graham explores the uncorrected weaknesses in depth and lays out the steps that should be now taken.
About the Author
Edward M. Graham, Senior Fellow at the Institute, was Associate Professor in the Fuqua School of Business at Duke University (1988-90), Associate Professor at the University of North Carolina (1983-88); Principal Administrator of the Planning and Evaluation Unit at the OECD (1981-82); International Economist in the Office of International Investment Affairs at the US Treasury (1979-80) and Assistant Professor at the Massachusetts Institute of Technology (1974-78). He is author or coauthor of numerous studies on international investment and technology transfer, including Fighting the Wrong Enemy: Antiglobal Activists and Multinational Enterprises (2000), Global Competition Policy (1997) and Competition Policies for a Global Economy (1997) with J. David Richardson, Global Corporations and National Governments (1996), and Foreign Direct Investment in the United States (3d edition 1995).
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