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South Korea’s Experience with Structural Reform: Lessons for Other Countries

  • Korean Social Science Journal
  • Abbr : KSSJ
  • 2006, 33(1), pp.1-24
  • Publisher : Korean Social Science Research Council
  • Research Area : Social Science > Social Science in general

Uk Heo 1 Jung-Yeop Woo 2

1University of Wisconsin - Milwaukee
2University of Wisconsin-Milwaukee

Candidate

ABSTRACT

Despite phenomenal growth through the mid 1990s, the1997 foreign exchange crisis led to the collapse of the South Korean economy, which resulted in an In ternational Monetary Fund (IMF) bailout. Since then, South Korea has gone through various reform processes. In this paper, we revisit pre- and post-crisis reform efforts in South Korea to draw lessons for other countries. Lessons drawn from the reform processes in the financial, labor, and corporate sectors in South Korea before and after the crisis are two fold. First, economic policy decisions must be made in accordance with economic interests and needs. Second, the government must have a long-term vision and an appropriate policy blueprint while economic restructuring is being implemented. Otherwise, long-term economic consequences may be greater than the short-term costs accompanied by reform policies.

Citation status

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