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The politics of chaebol reform in Korea : Social cleavage and new financial rules

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  • The politics of chaebol reform in Korea
  • Lee, Sook Jong
  • Routledge


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Title The politics of chaebol reform in Korea
Similar Titles
Sub Title

Social cleavage and new financial rules

Material Type Articles
Author(English)

Lee, Sook Jong

Publisher

[New York]:Routledge

Date 2008
Series Title; No Journal of Contemporary Asia / 38(3)
Pages 15
Subject Country South Korea(Asia and Pacific)
Language English
File Type Link
Subject Economy < Financial Policy
Industry and Technology < Entrepreneurship
Holding Routledge

Abstract

Korea's developmental state had long maintained the principle of "separation between
industrial capital and financial capital." whereby the nation's industrial conglomerates -
the chaebol - were restricted from having controlling ownership of financial institutions, especially
banks. The financial crisis of 1997-98 renewed calls for regulating the chaebol, especially
in terms of reinforcing corporate governance and competition policy. This process was supported
and promoted by vibrant non-governmental organisations led by progressive activists who forged
an effective alliance with the government and the ruling party whose platform followed a populist
course. The reform movement has been resisted with equal fervour by conservative elements, led
by the opposition party, chaebol-supported think tanks, and the conservative media. This cleavage
is evident in the case of a pending legislation on chaebol ownership of financial institutions, the
Financial Industry Structure Law. The controversy over this proposed law demonstrates that
the contemporary chaebol reforms are deeply politicised. It also illustrates the path-dependent
nature of the government-chaebol relationship. (The rest omitted)