This research seeks to identify the factors that brought continuous growth to the Korean economy between 1963 and 1976, an unprecedented case in the history of the global economy.
With continuous economic growth during this period, the Korean people’s standard of living made great advances along with improvements in the structure of domestic industries. In particular, prices and wages made an increase every year as industrial growth continued until 1972. The increased demand for labor during this era was also a driving force of this long-term period of growth.
According to figures compiled from the research, the Korean economy recorded a high annual growth rate of 10% from 1963 to 1976 while national income also increased by 9.4% every year. GNP marked an annual average of 11% while GNP per capita more than tripled from $146 USD to $456 USD. Furthermore, the non-residential industry recorded an annual growth rate of 10.25%, and its percentage in national income rose from 81.7% in 1963 to 90.8% in 1976. On the other hand, the inflow of foreign capital increased every year since 1960, which made up -1.6% of the national income in 1976. The non-residential income, which recorded an annual average of 6.06%, also saw a decrease in its share, as it fell from 3.2% to 2.1%.
The income-classification percentage of structures and equipment that stood at 13.4% between 1963 and 1969 rose to 17% between 1969 to 1976. During the same periods, the classification percentage of income from inventories and land increased from 7.1% to 21.8%, showing a difference of 5.8% and 17.1% respectively. Addtionally, the percentage of labor income classification has been increasing every year between 1963 and 1976, marking a level higher than 60%. However, this is still relatively lower than that of Japan, as the level of other countries including Canada, France, Norway, and United Kingdom are as high as 78-79%.
Overall, the industrial structure of the Korean economy is constantly changing, bringing a favorable improvement for production. This improvement, taking more than 33.5% among the factors of overall growth, also brings a positive impact on the labor workforce. In this context, the positive factors that brought growth in the Korean economy can be identified as technological change, development of the manufacturing industry and development of technical skills in the field of agricultural technology and self-entrepreneurship. A comparison with other developed countries such as Japan or the United States still shows that Korea’s speed and scale of growth is remarkably high. The main cause behind this scale of growth is the high percentage of mobilization and distribution of the workforce.
한국경제의 고도성장요인(Factors of rapid economic growth of the Korean economy between 1963-76)
|Journal Title; Vol./Issue||한국개발연구:vol. 1(no. 1)|
|Subject Country||South Korea(Asia and Pacific)|
|Subject||Economy < Economic Administration|
|Holding||KDI; KDI School|