South Korea: Economic Miracle by Policy Miracle?

Historical, cultural and institutional factors certainly did have a positive impact on the economic growth in South Korea and the other East Asian newly industrialising economies. However, these factors would not have been of any importance without governmental influence. Particularly in South Korea, a strong state with highly respected and qualified bureaucrats could play a central role in stimulating economic growth, first by trade policy (export-push strategy), later by industrial policy and technology policy. The most outstanding strengths of South Korean policy are flexibility, planning and implementation, pragmatism and a close relationship between bureaucrats and industry. These close relationships with firms and their highly respected position allow bureaucrats to monitor policy carefully and change policies quickly.