Experiences of Economic Reforms in Korea and Future Challenges

Abstract

In the wake of the economic crisis, the Kim Dae-jung administration was quick to implement a series of highly publicized economic reforms. As Chapter 9 will show, these have enjoyed some success. However, with every other news item after 1997 heralding yet another addition to this ‘unprecedented series of reforms’, the foreign observer might be forgiven for concluding that the Korean economy is a complete stranger to reform. To a certain extent this is true. Despite some of the fundamental changes wrought by the processes of globalization and liberalization, and despite Korea’s apparent recognition of these trends, three decades of remarkable economic success effected to drown out the voices calling for large-scale structural reform. However, Korea is now forced to consider broad reforms, not just as a ‘quick fix’ in a knee-jerk response to the crisis, but as an ongoing process encompassing all economic sectors. This chapter explores the critical issue of institutional reform and the political economy behind economic reforms, ending with some questions about the implementation and continuance of future reforms.