Tuesday, March 23, 2010

Exporting the Korean Development Model

"The objective of the U.S.' Peace Corps was to disseminate the values of American democracy, and Japan's goal was to improve its post-war image and to gain economic benefits," says an official of the organization reported on in this story — Korea's Overseas Volunteer Corps 3rd Largest in World. "But Korea focused on transferring the Korean model of economic development."

Now, I don't mean to take away anything from Korean Stakhanovism's rôle in this country's rapid development. I, too, was here when the garbage trucks still blasted songs at 5:00 AM extolling people to wake up and work hard for their country. But their are other key factors that will much harder to export.

Key to the Korean (and Japanese) development model is finding a superpower to cover your defense for decades, enabling you to divert state funds into the private corporate sector. Also key is for that ally to open its markets to your products while allowing you to close yours to hers.

With the current economic ruin in the America, it is unlikely that she will agree to enter into many more such arrangements in the developing world. That leaves China. But something tells me that with their 5000 years of experience, the Chinese are not that stupid. After all, they never entered into such an agreement with the Northern part of this peninsula, bankrupted, not that unlike America, from its "military first" policy. Even with their "teeth and lips" closeness with North Korea, the Chinese have since the Korean War put their own interests first and foremost.

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3 Comments:

Blogger Mark in Spokane said...

Don't overlook one critical fact about South Korea's background that helped it to thrive economically: its underlying culture. Confucianism is a strong cultural support for economic growth, as it emphasizes those elements of community moral life that can allow the development of a thriving economy: personal responsibility, duty, loyalty and commitment to self-discipline. Not that Confucianism is enough on its own (not underlying moral/philosophical system is) but it is an essential component of S. Korea's economic success. And that would be something very difficult to transplant to a different place.

12:46 PM  
Blogger The Western Confucian said...

Agreed.

12:50 PM  
Blogger kushibo said...

Key to the Korean (and Japanese) development model is finding a superpower to cover your defense for decades, enabling you to divert state funds into the private corporate sector.

No doubt the US provided a security umbrella in which South Korea was allowed to grow and thrive, but I'm not so sure that it would be accurate to say the US "covered South Korea's defense," nor that South Korea was able to take advantage of largesse by diverting state funds into the private corporate sector.

That is to say, even with the defense treaty with the US that has been instrumental in keeping Korea, South Korea has expended tremendous amounts of capital and labor to keep up its side of the military, far more than Japan has done (not that I'm bashing Japan for that).

South Korea has required lengthy military service of almost all its men for decades, representing a huge opportunity cost during the developmental years, while spending a large portion of GDP on defense. Even today, it's one of the highest among US allies.

At the same time, let's not forget that other countries, too, had sweetheart deals like South Korea or Japan, yet they failed to rise up like South Korea (or Japan).

3:06 AM  

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