Economic Development Of Korea

by Chuk Kyo Kim

Overview

The purpose of this book is to provide a systematic and policy-focused analysis of Korea's development performance from a historical perspective. The book begins with post-war reconstruction efforts and extends to recent developments in the Korean economy. Through a comprehensive analysis of Korea's development performance over the last six decades, the book examines in detail how development strategies and policies evolved over time, what were their consequences and underlying factors, and what lessons can be drawn from the Korean experience. A wide range of issues are discussed, including the role of government, capital accumulation, growth and structural change, industrial development and concentration, economic liberalization, human resource and technology development, social development and income distribution. The important features of the Korean development model are highlighted to draw lessons from the Korean experience.

Product Details

ISBN-13:	9789813274907
Publisher:	World Scientific Publishing Company, Incorporated
Publication date:	03/19/2019
Pages:	308
Product dimensions:	6.00(w) x 9.00(h) x 0.75(d)

Table of Contents

About the Author xi

Acknowledgments xiii

Introduction xv

1 A Historical Overview 1

1.1 Post-War Reconstruction and Foreign Aid (1950s) 1

1.2 Outward-Oriented Industrial Development (1960s) 7

1.3 Industrial Upgrading and a Big Push for Rural Development (1970s) 10

1.4 Market Opening and Liberalization (1980s) 15

1.5 Globalization, Financial Crisis, and Structural Reform (1990s) 17

2 Role of Government 25

2.1 Two Competing Views 25

2.2 The Changing Role of Government 27

2.2.1 Laying the Groundwork for Development (1950s) 28

2.2.2 State-Led Development (1960s-1970s) 32

2.2.3 Transition to Market-Oriented Development (1980s) 34

2.2.4 Toward Market-Led Development (1990s) 37

3 Capital Accumulation 41

3.1 Savings and Investment Rates 41

3.2 Accumulation Process 44

3.2.1 Investment, Growth, and Increase in Savings 44

3.2.2 Role of Financial Institutions 50

3.2.3 Efficiency of Investment 53

3.3 Characteristics of the Accumulation Process 55

4 Growth and Structural Change 59

4.1 Investment-Led Growth 59

4.2 The Slowing Growth Rate 64

4.3 Structural Changes 66

4.4 Sources of Growth 67

4.5 Institutional and Policy Factors 70

4.5.1 Strong Leadership Commitment 70

4.5.2 Transforming Import Substitution Industries into Export Industries 74

5 Industrial Development and Structural Transformation 79

5.1 Evolution of Industrial Development Policy 79

5.1.1 Easy Import Substitution (1950s) 80

5.1.2 Export Drive and Selective Import Substitution (1960s) 83

5.1.3 HCI Promotion and Second-Stage Import Substitution (1970s) 88

5.1.4 Structural Adjustment and Technology-Oriented Industrial Policy (1980s) 93

5.1.5 Globalization and Promotion of High-Tech Industries (1990s) 96

5.2 Industrial Growth and Structural Transformation 99

5.2.1 Growth of Manufacturing Sector 99

5.2.2 Structural Changes 105

5.3 Industrialization Process 107

5.3.1 Nondurable Consumer Goods 107

5.3.2 Durable Consumer Goods and Intermediate Goods 109

5.3.3 Capital Goods 119

6 Industrialization and SME Development 123

6.1 An Overview of the SME Development Policy 123

6.2 Growth and Structural Change of SMEs 127

6.3 Problems Facing SMEs and Policy Implications 131

7 Industrialization and Concentration of Economic Power 137

7.1 Rapid Industrial Growth and Concentration of Economic Power 137

7.2 Economic Concentration and Chaebol Policy 143

8 Liberalization Policy and Process 151

8.1 Evolution of Liberalization Policy: An Overview 152

8.1.1 Export Promotion and Liberalization Efforts (1960s) 152

8.1.2 Heavy and Chemical Industry Promotion and Setback in Liberalization (1970s) 154

8.1.3 Policy Shift toward Market-Oriented Development and Renewed Liberalization Efforts (1980s) 156

8.1.4 Globalization and Accelerated Liberalization (1990s) 161

8.2 Major Features and Sequencing of the Liberalization Policy 166

9 Financial Crisis and Policy Response 173

9.1 Causes of the Crisis 173

9.1.1 Structural Weaknesses 174

9.1.2 Failed Reform Attempts 178

9.1.3 Origins of the Crisis 180

9.2 Policy Response and Achievements 182

9.2.1 Macroeconomic Policies 182

9.2.2 Structural Reforms 185

9.2.3 Achievements 191

10 Education and Human Resource Development 195

10.1 Rapid Expansion of Education 195

10.2 Human Capital Formation and Economic Growth 202

11 Industrialization and Science and Technology Policy 207

11.1 Evolution of Science and Technology Policy 207

11.1.1 Export Promotion and Skilled Manpower Development (1960s) 208

11.1.2 HCI Promotion and Local Technological Capability Building (1970s) 210

11.1.3 Technology-Oriented Industrial Policy and Strengthened R&D Incentives (1980s) 214

11.1.4 High-Tech Industry Promotion and Policy Shift from Imitation to Innovation (1990s) 218

11.2 R&D Activities and Performance 220

11.3 Features of Science and Technology Policy 224

12 Social Development and Income Distribution 227

12.1 Evolution of Social Policy: An Overview 227

12.1.1 Building Social Security System (1960s-1970s) 228

12.1.2 Policy Shift toward Improving Social Welfare (1980s-1990s) 230

12.1.3 Expansion of Social Welfare Programs (2000s) 232

12.2 Trends of Income Distribution 234

12.3 Indicator Distribution and Perceived Distribution 240

13 Growth Driving Forces and Growth Prospects 245

13.1 The Falling Potential Growth Rate 245

13.2 Policy Directions for Raising Potential Growth 251

13.2.1 Increasing Labor Supply and Stimulating Investment 251

13.2.2 Upgrading Human Capital Formation 252

13.2.3 Enhancing the Efficiency of R&D Activities 254

13.2.4 Promoting New Growth Industries 256

13.2.5 Promotion of Service Sector 259

14 The Korean Development Model: Characteristics and Lessons 263

References 273

Index 281