The Korean Economic Forum
The Korean Economy Beyond Condensed Industrialization: Tasks and the Keynote for Reform
Jaewan Bahk (Sungkyunkwan University)Year 2017Vol. 10No. 2
The Korean economy has achieved remarkably compressed industrialization,vital social mobility, and decent economic equality during the last six decades.Such a success is mainly attributed to human resource development (particularlyin science, technology and engineering) and ‘technocratic dominance’ overpolitics in policy making. Recently, however, Korea’s growth potentials aresteadily weakening and social mobility is declining. Ironically, humancompetency and policy making with minimal political distortions, two key factorsto the past success, are now converted into roadblocks. Demographic dividendsare dissipating and human competencies are trailing behind technologicalprogress. Representative democracy is malfunctioning and government failuresare growing. Reforming or upgrading out-of-date institutions, regulations,practices, and organizational culture has fallen into arrears due topopulism-prone leadership. A sweeping structural reform for productivityimprovement is an inevitable path and a shortcut to boost both growth andequality. First, welfare, education, and labor market systems must be reformedto expand human resources and enhance human competency. Second, economicliberalization must be pursued to establish market-friendly systems, fosterinnovation, and reduce government intervention. For a successful reform, tworequisites are proposed: an advocacy leadership with moral suasion, and‘statecraft’ in strategic change management.