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Was The Experience of South Korea's Developmental State Unique

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Table of contents

  1. The legacy of Japanese colonialism
  2. A new economic composition
  3. ‘Embedded autonomy’ through a strong state-capital relationship
  4. Repression of the working classes

This response will evaluate whether the experience of South Korea’s developmental state was a unique phenomenon in economic development or if it could actually be replicated elsewhere. Before delving into the question itself it is necessary to briefly explain that the ‘developmental state model’ is characterised by high levels of government regulation and intervention driven by a determined developmental elite; a powerful and insulated economic bureaucracy; a weak and deeply subordinated civil society; efficient management of non-state economic interests as well as harshly conducted repression of the general population. 

In reference to the question, this response will examine a number of significant factors that enabled the long-term success of the developmental state in South Korea: the significance of historical context such as the legacy of Japanese colonialism as well as the Korean and Vietnamese Wars, the changes to the economic composition of the nation, repression of the working classes, the state-capital relationship and finally how the interlinked ‘embedded autonomy’ enabled developmental success. Eventually coming to the conclusion that the legacy of Japanese colonialism laid the foundation for the rest of the mentioned factors to occur and assist South Korea in effectively implementing the developmental state model, essentially making this experience unique due to the historical context.

The legacy of Japanese colonialism

Finally, the most significant factor in the South Korean model being unique compared to other late industrialisers such as India and Brazil was that ‘the grooves that Japanese colonialism carved on the Korean social soil cut deep’. These ‘grooves’ Kohli speaks of were most apparent through a number of key identifiers left behind by the Japanese colonialist state, for example, the presence of the strong state-capital relationship, merit fuelled technocracy, a newly constructed education system and sturdy government ministries. These factors (to be mentioned throughout the response) combined to make South Korea almost a smaller version of Japan that would facilitate years of highly sustainable growth. By in large as it enabled the presence of a strong centralized government and interlinked bureaucracy who could control the lower classes with great ease as well as facilitate economic export expansion with a focus on fuelling specific ‘infant industry’. However, the years of rapid development that South Korea witnessed throughout the latter half of the twentieth century were not attainable due to the legacy of the institutions left behind but also by the influence colonialism had on certain individuals, in particular the country’s new leader Park Cheung-Hee. Recognised by many scholars as a ‘Japanophile fascinated with the Meiji model’, which had been vital in Japanese development for the majority of the 20th century, it comes as no surprise that Cheung-Hee didn’t believe the radical change was required to assist a great developmental explosion and he certainly wasn’t wrong.

It is clear that ‘Japan created a unique colonial structure in Korea and Taiwan not found elsewhere in the world.’  Flying geese model ‘Japan ’hands down industries to SK and other East Asian states, investment of Japanese capital, the emergence of global production networks.

A new economic composition

In order to analyse whether South Korea’s experience of the developmental state model is unique will now examine the economic success attained through high government regulation and intervention under the Democratic-Republican Party (DRP) regime. Doing so will enable us to properly evaluate the significance of the other factors mentioned in the introduction. The DRP of South Korea was first formed by Park Cheung-Hee’s government on the 2nd February 1963 until its dissolution on the 1st September 1980 not long after the assassination of the aforementioned leader on the 26th October 1979. South Korea’s execution of the developmental state model throughout most of the second half of the 20th following the May 1961 coup, led by General Park Cheung-Hee up until late 1979, was the prime example of a late industrialiser effectively utilising a guided market economy that prioritised widespread industrialisation in order to maintain sizeable levels of growth and development. Late industrialisers can be defined as states that started the 20th century with lacklustre levels of economic strength who achieved drastic increases in national income per capita consistently over time by investing in different industry sectors selectively. The term ‘late’ is to differentiate between early industrialisers such as Great Britain, Germany, Japan and the United States of America. The newly founded Economic Planning Board (EPB) in South Korea introduced a 5-year economic plan between 1962 and 1966 with one of the major stipulations being to attain a 7.1% growth rate in the economy in this period.

In fact, due to the focus on export-orientated industrialisation or EOI (exports up 29% per year on average in the period), the South Korean economy exceeded this target by actually attaining an average growth rate of 8.9%. Quite obviously such an upward growth rate led to a more accelerated industrialisation process. Which in turn meant the state could selectively invest in industry infrastructure further e.g. tungsten, iron and graphite production that was more likely to aid the economy long term by attracting foreign direct investment from countries such as the United States of America and Japan. Clearly, South Korea’s shift from import substitution industrialization (ISI 1) in the 1950s (common in postcolonial nations) and export-orientated industrialisation under the DRP regime was highly successful and displayed the significance of international trade. This is exemplified by the fact that due to manufacturing goods (and the removal of tariffs on imports if they were to be used in the production of exports) South Korea’s ‘merchandise export share of GDP rose from just 2% in 1962 to 30% in less than 20 years.’ 

When taking into account the success of South Korea we can recognise that the structural changes to its economy and its success with EOI aren’t wholly replicable to such an extent in other nations. For example, the military junta in control of Brazil around the same time utilised a mixture of EOI and ISI 1 and for some period this system of ‘dependent development’ was massively successful, especially between 1968-1973 where the Latin American powerhouse experienced astronomical levels of growth due to great agricultural and industrial expansion. This is backed up by Brazil’s gross national product (GNP) increasing around 10% each year between 1967-1971 as well as average income per capita in the same period increasing by approximately 49%. (Fishlow, 1973: 475) However, this success would be short-lived when the 1973 oil shock hit exposed Brazil’s dependency on foreign capital, specifically investment from the USA, as well as highlighting the strong import dependence the nation was built upon. Now although South Korea wasn’t exactly devoid of any impact of the oil crisis in 1973 as they saw massive rises in inflation of almost 40%; it is evident that due to Brazil’s heavy reliance on imports and foreign capital they were especially prone to possible exogenous shocks such as the second oil shock of 1979. The evidence presented in this section displayed how the economic planning driven by the DPR regime and the Economic Planning Board (EPB) was highly sustainable from within South Korea while on the other hand countries attempting to replicate the developmental model found it far more difficult to sustain, signifying SK’s uniqueness.

‘Embedded autonomy’ through a strong state-capital relationship

Now it is of utmost importance to explain a strong state-capital relationship and how the DPR regime colluded with the chaebol of South Korea in order to stimulate the rapid industrialisation covered in the last paragraph. These chaebols can be defined as large industrial conglomerates that resided as prominent and powerful members of the Korean plutocracy e.g. Kyungbang, and Packsan Trading Company. Essentially a strong state-capital relationship is highly beneficial to both sides as it can drastically cut costs of transactions between actors as well as warrant the more effective formation and implementation of policy. The ideas suggested by Evans also stipulate that despite a strong relationship, the likelihood of a bureaucratic elite being overly influenced by the interests of big business needs to be minimal. This ‘insulation of the bureaucracy’ was especially effective because the state remained the dominant actor in the agreement, as they obviously were in total control of all investment and credit as well as being in charge of setting evaluative performance criteria for business elites to reach or risk losing the benefits of the state-capital relationship.

Moreover, this leads onto one of the most significant reasons why other countries have found it nigh impossible to properly replicate South Korea’s success and that is the presence, or lack thereof, of large landowners. When Japanese colonial rule in the East Asian nation ended following World War Two the top 2.7% of South Korean society (in terms of wealth) owned around 66% of all farming land; however, just nine years later in 1956, the top 6% owned just under a fifth of the total farming land. Now the reason this is so significant is that the lack of large landowners meant there was little to no desire to focus on primary product exportation as means of boosting the economy. With little reliance on this form of industry, the DPR regime could remain wholly dominant and not fear being subordinated by capital interests. In comparison with another late industrialiser, Brazil, who to this day resides as the country with the most unequal level of land distribution globally, with 10% of Brazilian properties owning 75% of all agricultural land in 2020. This key difference illustrates how South Korea possessed an economy far more able to mould itself to a sustainable developmental state model with its ‘deeper state-society configurations’ making it far more unique than other developing nations.

Repression of the working classes

Tied in with the aforementioned ‘embedded autonomy’ created by the state-capital relationship in South Korea throughout the latter half of the twentieth century; was the consistent repression of the South Korean population, in particular the labour force. First of all it is evident through the idea of the ‘cruel dilemma’ that harsh repression of the labour working class ordered by an authoritarian elite and assisted by security forces; has proved vitally instrumental to achieving rapid industrialisation in numerous states through time and this was certainly true for South Korean development in the twentieth century.

Clearly, in this era of South Korean history the lower classes, particularly the labour force and closely affiliated trade unions, were subjected to cruel repression in order to reinforce the power of the bureaucracy as well as reduce dissidence across the country. There is no doubt that in order attain the status of an advanced capitalist nation the South Korean authoritarian state and chaebols in the 1960s and beyond engaged in the immiseration of the proletariat through: the suppression of trade union activity, long hours of labour-intense employment and drastically low wages. For example, Park Cheung-Hee’s government introduced laws that prohibited participation in and the formation of labour unions for workers with those who broke these laws being punished with imprisonment, torture and in some cases even death. To enact such widespread repression of society’s lower classes in such a cruel and immoral manner today makes this model very archaic and somewhat unique however utilising repression in an authoritarian manner to boost the economy is definitely replicable elsewhere. E.g.

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