Participatory democracy and Chaebol regulation in Korea: State-market relations under the MDP governments, 1997-2003

Asian Survey

Volumn 45, Issue 2, 2005, Pages 279-301

  Lee, Yeonho ^a  

^a Yonsei University   (South Korea)

Author keywords

[No Author keywords available]

Indexed keywords

MARKET CONDITIONS; POLITICAL ECONOMY;

ASIA; EASTERN HEMISPHERE; EURASIA; FAR EAST; KOREA; WORLD;

NEXUS;

EID: 19444377183     PISSN: 00044687     EISSN: None     Source Type: Journal    
DOI: 10.1525/as.2005.45.2.279     Document Type: Article

References (67)

1. Yeonho Lee, The State, Society, and Big Business in South Korea (London: Routledge, 1997).
2. Chung-in Moon and Jongryn Mo, Economic Crisis and Structural Reforms in South Korea: Assessments and Implications (Washington: Economic Strategy Institute, 2000);
3. Barry Gills and D. S. Gills, "South Korea and Globalization" in East Asia and Globalization, ed. Samuel Kim (Boston: Rowman and Littlefield, 2000).
4. At the time when Roh was inaugurated as president in February 2003, he belonged to the MDP. But Roh soon seceded from the MDP to create the Uri Party in November 2003.
5. Inter-subsidiary payment guarantees - the chaebols' practice of exchanging payment guarantees between member firms when one of them borrows fresh loans from financial institutions - have served as a method of reckless business diversification. The KDJ government enforced a business swapping program (the so-called Big Deal) on the five largest chaebols to make them specialize in mainline industries. As for the largest chaebols, ranked between sixth and 64th, the government enforced a "work-out" program so that creditor banks would provide additional relief loans to ill-managed firms suffering from short-term financial liquidity.
6. The notion of "New Right" includes neo-liberalism and neo-conservatism. See David Held, Models of Democracy (Cambridge, U.K.: Polity, 1987), p. 251.
7. Carole Pateman, Participation and Democratic Theory (Cambridge, U.K.: Cambridge University Press, 1970);
8. E. Huber, D. Rueschemeyer, and D. Stephens, "The Paradoxes of Contemporary Democracy," Comparative Politics 29 (April 1997), pp. 323-42.
9. Held, Models of Democracy, p. 251;
10. Huber, Rueschemeyer, and Stephens, "The Paradoxes of Contemporary Democracy."
11. The chaebol had excessively diversified their business areas despite their poor financial statements. Such an irresponsible management practice was attributed to the belief that the chaebol were too big to fail: that is to say, the chaebols' proportional presence in the Korean economy is too large for the government to let them go bankrupt. The chaebol could, therefore, shift their financial risk to unrelated stakeholders of the society (i.e., socialization), committing moral hazard.
12. ROK government, Kukminkwa Hamke Naeil ul Yonda: DJnomics-Kukmin ui Chongbu Kyongie Chongsajin [Open the tomorrow with the people: DJnomics-economic blue print of the people's government] (Seoul: Republic of Korea [ROK] government, 1998), pp. 55-57.
13. Steven K. Vogel, Freer Markets, More Rules: Regulatory Reform in Advanced Industrial Countries (Ithaca, N.Y.: Cornell University Press, 1996).
14. Andrew Gamble, "Economic Governance," in Debating Governance, ed. Jon Pierre (Oxford: Oxford University Press, 2000);
15. Will Hutton, The State to Come (London: Vintage, 1997), ch. 1.
16. ROK government, Open the Tomorrow;
17. ROK Office of the President at , accessed May 2003.
18. Robert D. Putnam, Making Democracy Work: Civic Traditions in Modern Italy (Princeton, N.J.: Princeton University Press, 1993);
19. Peter Evans, "The Eclipse of the State? Reflections on Stateness in an Era of Globalization," World Politics 50:1 (October 1997), pp. 62-87.
20. Gamble, "Economic Governance";
21. Stephen Wilks, "Conservative Governments and the Economy, 1979-97," Political Studies 45:4 (September 1997), pp. 689-703;
22. Giandomenico Majone, "From the Positive to the Regulatory State," Journal of Public Policy 17:2 (June 1997), pp. 139-67.
23. For the argument of the rise of the regulatory state in East Asia after the outbreak of the financial crisis, refer to K. Jayasuriya and A. Rosser, "Economic Orthodoxy and the East Asian Crisis, Third World Quarterly 22:3 (June 2001), pp. 381-96.
24. The idea of participation had already developed before Kim Dae-jung took office. He asserted the need of democratization to tackle economic problems related to economic concentration, labor, and unbalanced growth between regions and industrial sectors in his book Daejung Kyongieron [Mass-participatory economy] (Seoul: Ch'ongsa, 1986).
25. Andrew Gamble, The Free Economy and the Strong State: The Politics of Thatcherism (Durham, N.C.: Duke University Press, 1998).
26. Jongryn Mo, "Political Culture and Legislative Gridlock: Politics of Economic Reform in Pre-crisis Korea," Comparative Political Studies 34:5 (June 2000), pp. 467-92;
27. Jongryn Mo and Chung-in Moon, "Korea after the Crash," Journal of Democracy 10:3 (July 1999), pp. 150-63.
28. Yeonbo Lee and Hyuk-rae Kim, "The Dilemma of Liberalization: Financial Crisis and the Transformation of Capitalism in South Korea," in Politics and Markets in the Wake of the Asian Crisis, eds. R. Robison, M. Beeson, K. Jayasuriya, and H. Kim (London: Routledge, 2000).
29. Kurt Weyland, "From Leviathan to Gulliver? The Decline of the Developmental State in Brazil," Governance 11:1 (January 1998), pp. 51-75.
30. Frederic Deyo, "Introduction," in The Political Economy of the New Asian Industrialism, ed. F. Deyo (Ithaca, N.Y.: Cornell University Press, 1987).
31. Lee, The State, Society, and Big Business in South Korea.
32. Chung-in Moon and Rashemi Prasad, "Beyond the Developmental State: Networks, Politics, and Institutions," Governance 7:4 (July 1994), pp. 360-86;
33. Uk Heo and Sunwoong Kim, "Financial Crisis in South Korea: Failure of the Government-Led Development Paradigm," Asian Survey 40:3 (May/June 2000), pp. 492-507.
34. F. A. Hayek, The Road to Serfdom (London: Routledge and Kegan Paul, 1976);
35. Held, Models of Democracy.
36. Huber, Rueschemeyer, and Stephens, "The Paradoxes of Contemporary Democracy";
37. Pateman, Participation and Democratic Theory.
38. Helmut K. Anheier and Wolfgang Seibel, eds., The Third Sector: Comparative Studies of Nonprofit Organizations (Berlin: Walter de Gruyter and Co., 1990).
39. Stephan Haggard and Robert R. Kaufman, eds., The Politics of Economic Adjustment (Princeton, N.J.: Princeton University Press, 1992).
40. Mancur Olson, The Rise and Decline of Nations (New Haven, Conn.: Yale University Press, 1982);
41. Mancur Olson, Power and Prosperity (New York: Basic Books, 2000).
42. See Lee and Kim, "The Dilemma of Liberalization."
43. Martin C. McGuire and Mancur Olson, Jr., "The Economics of Autocracy and Majority Rule: The Invisible Hand and the Use of Force," Journal of Economic Literature 34 (March 1996), pp. 94-95.
44. Richard Doner, "Limits of State Strength," World Politics 44:3 (April 1992), pp. 398-431.
45. Chung-in Moon and Sang-young Rhyu, "The State, Structural Rigidity, and the End of Asian Capitalism: A Comparative Study of Japan and South Korea," in Politics and Markets in the Wake of the Asian Crisis.
46. ROK government, Shinkyongie o Kaenyon Kyehoek [New five-year economic plan] (Seoul: ROK government, 1993).
47. N. Jesse, U. Heo, and K. DeRouen, "A Nested Game Approach to Political and Economic Liberalization in Democratizing States: The Case of South Korea," International Studies Quarterly 46 (September 2002), pp. 401-22.
48. Ministry of Finance and Economy and Financial Supervisory Commission, Kongjok Chageum Baekso [White paper on the public fund] (Seoul, 2000).
49. I b i d.
50. Fair Trade Commission, Sijang Kyongje Ch'angdal ui Paljachui [The track of creating a market economy] (Seoul: Fair Trade Commission, 2001).
51. I b i d.
52. Bong-gyun Kang, "Bikdil, Silpaehan Chonchaekin'ga?" [Was the Big Deal Policy a failure?], Han'guk Kyongje Shinmun [Korea Economic Daily] (Seoul), August 3, 1999.
53. Kotaro Tsuru, "Finance and Growth: Some Theoretical Consideration and a Review of the Empirical Literature," Economics Department Working Paper, no. 228 (OECD, 2000).
54. Song-su Ko, "The Achievement of Financial Structural Adjustment and Its Future Tasks," Financial Study 15 (extra issue) (Seoul: Korea Institute of Finance, August 2001), p. 6.
55. Ko, "The Achievement of Financial Structural Adjustment."
56. ROK Office of the President, at , accessed May 2003.
57. Korea Herald (Seoul), February 27, 2003;
58. Dong-A Ilbo [Dong-A Daily News] (Seoul), October 8, 2002;
59. Chosun Ilbo [Chosun Daily News] (Seoul), January 8, 2003.
60. Kim Junki, "The Growth of the Non-Government Sector in Korea and Its Relations with the State," paper presented at the Northeast Asian Civil Society Conference on the "Current Status and Challenging Roles of NGOs in Korea, Japan, and China," Yonsei University, Seoul, November 2000.
61. People's Solidarity for Participatory Democracy, at , accessed May 2003.
62. Citizens' Coalition for Economic Justice, at , accessed May 2003.
63. Chosun Ilbo, March 8, 2000.
64. Joongang Ilbo [Joongang Daily News] (Seoul), January 7, 2003.
65. Chosun Ilbo, March 11, 2003.
66. Korea Herald, February 26, 2003.
67. Olson, The Rise and Decline of Nations.