Unlike other existing economic structure analyses employing short-term perspectives, this study reviews the development process of Korea’s market economy and democracy throughout a 300-year period (starting from the late 17th century) so as to develop policy suggestions.
Until the 1960s, Korea’s agricultural markets, involving the majority of the nation’s population, saw mostly people-to-people transactions with almost no credit transaction. Afterwards, Korea’s market economy started to transition into an organized market protected by the state and legal institutions, and developed a stable structure. However, despite advancements in democracy, school ties and regionalism, a custom unique to Korean culture, still rule, and economic players who are not accustomed to basic market principles and ethics obstruct efficient distribution of resources. As such, the principles and the sentiment of nanjang, irregular temporary marketplaces, seem to be at work in the current Korean capitalistic market.
In a market economy and democracy, resources are efficiently distributed through competition. In that process, economic players should depend on each other. Since the 1980s, thanks to the advancement of democracy and regulatory reform drives, the government’s excessive involvement in the economy was scaled back, but policy efforts aimed at instilling a market order for fair competition failed, causing social issues. It is imperative that laws and institutions to be established so as to reform the disordered market and ensure strict enforcement. Elite society should play a constructive role to realize the free competition of the market economy.
한국 시장경제와 민주주의의 역사적 특질(Historical characteristics of Korea’s market economy and democracy)
|Series Title; No||연구보고서 / 99-04|
|Subject Country||South Korea(Asia and Pacific)|
|Subject||Economy < Economic System
Government and Law < Political Systems
|Holding||KDI; KDI School|