Korea's Developmental Alliance: State, capital and the politics of rapid development

249 Pages·2008·0.9 MB·English

by  David Hundt

Korea’s Developmental Alliance
South Korea is often cited as a case of miraculous transformation from poverty
to prosperity. Korea’s achievement of moving from one of the world’s poorest
countries as recently as the early 1960s to the ranks of the ten biggest economies
only four decades later has rightly attracted interest from policymakers and
scholars alike.
This book identifies the factors that shaped relations between the state and big
business in Korea, the ‘developmental alliance’. These factors offer a cogent
framework in which to identify and predict changes in power relations between
government and business. Rather than merely offering a means of explaining the
rapid-growth phase of Korean development, the politics of the developmental
alliance also help us understand how and why the Korean miracle turned to crisis
in 1997 and why the subsequent recovery has been so uneven. In this way, the
book highlights the political power of business, which is often underplayed in
discussions of the development of Korea. It also sheds light on the constraints on
policymakers during modernisation, and how power is shared among a small
number of powerful parties.
Illustrating the tumultuous politics of the ‘developmental alliance’ between
business and government during the rise and decline of South Korea’s economic
miracle, this book is an essential read for anyone interested in Korean politics,
economics and development.
David Hundt is Lecturer in International Relations at Deakin University,
Australia.
Routledge Advances in Korean Studies

1 The Politics of Economic Reform in South Korea A fragile miracle Tat Yan Kong 2 Market and
Society in Korea

Interest, institution and the textile industry Dennis McNamara 3 Social and Economic Policies in Korea
Ideas, networks and linkages Dong-Myeon Shin 4 North Korea in the World Economy
Edited by E. Kwan Choi,
Yesook Merrill and E. Han Kim
5 Legal Reform in Korea
Edited by Tom Ginsburg
6 Women, Television and Everyday Life

Journeys of hope Youna Kim 7 Transformations in Twentieth Century Korea Edited by Chang Yun-

Shik and Steven Hugh Lee 8 The Development of Modern South Korea
State formation, capitalist development and national identity Kyong Ju Kim
9 Industrial Relations in Korea

Diversity and dynamism of Korean enterprise unions from a comparative perspective Jooyeon Jeong
10 The Global Korean Motor Industry

The Hyundai motor company’s global strategy Russell D. Lansbury, Chung-Sok Suh and Seung-Ho Kwon

11 Korean Workers and Neoliberal Globalisation Kevin Gray
12 Korea in the New Asia

East Asian integration and the China factor Francoise Nicolas 13 Foreign Direct Investment in Post-

Crisis Korea European investors and ‘mismatched globalization’
Judith Cherry
14 Korea Confronts Globalization

Edited by Chang Yun-Shik, Hyun-ho Seok and Donald L. Baker 15 Korea’s Developmental Alliance
Korea’s
State, capital and the politics of rapid development David Hundt
Developmental Alliance
State, capital and the politics of rapid development
David Hundt
Contents
Acknowledgements
Abbreviations
Note on romanisation
Introduction
Prologue: a new beginning?
Power and political economy in Korea
The dynamics of the developmental alliance
Overview of the book
1 Korea in the political economy literature
Appraising the neoclassical approach
The developmental state and Korea
The structural power of business
Conclusions
2 The dynamics of the developmental alliance
From developmental state to developmental
alliance
Conclusions: a new understanding of Korean
development
3 Priming for take-off
Learning the lessons of Japan
Geopolitics and the imperatives of the Cold War
The Rhee interregnum
Conclusions
4 Forming the developmental alliance
The view from Washington
The limits of state power
Containing the backlash
Conclusions
5 The developmental alliance in flux
Retrenching the state?
The democratic interlude
Kim Young-sam and globalisation
No way out?
6 Realigning the alliance
The paradox of neoliberal reform
Learning to love the IMF
Repositioning the state
The taming of the two
The politics of chaebol discipline
Widening the alliance?
From crisis to recovery
7 The alliance in retrospect
Bureaucracy
Social pressures
National security
Economic conditions
Globalisation
Patterns of change
Still the developmental alliance?
The alliance and the market
Appendix 1
Appendix 2
References
Index
David Hundt
R

Routledge
Taylor & Francis Group LONDON AND NEW YORK
First published 2009 by Routledge
2 Park Square, Milton Park, Abingdon, Oxon OX14 5RN

Simultaneously published in the USA and Canada by Routledge 29 West 35 th Street, New York, NY
10001
This edition published in the Taylor & Francis e-Library, 2008.
“To purchase your own copy of this or any of Taylor & Francis or Routledge’s collection of thousands of
eBooks please go to www.eBookstore.tandf.co.uk.”

Routledge is an imprint of the Taylor & Francis Group, an informa business © 2009 David Hundt
All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any
electronic, mechanical, or other means, now known or hereafter invented, including photocopying and
recording, or in any information storage or retrieval system, without permission in writing from the
publishers.
British Library Cataloguing in Publication Data A catalogue record for this book is available from the

British Library Library of Congress Cataloging in Publication Data Hundt, David.
Korea’s developmental alliance: state, capital and politics of rapid development/David Hundt. p.cm.
Includes bibliographical references and index.
1. Business and politics—Korea (South). 2. Korea (South)— Economic policy. 3. Economic development—
Korea (South).
4. Korea (South)—Economic conditions. 5. Korea (South)— Politics and government. I. Title.
HC467.756.H86 2008
338.95195—dc22 2008017316
ISBN 0-203-88906-1 Master e-book ISBN
ISBN10: 0-415-46668-7 (hbk)
ISBN10: 0-203-88906-1 (ebk)
ISBN13: 978-0-415-46668-4 (hbk) ISBN13: 978-0-203-88906-0 (ebk)
Contents
Acknowledgements
Abbreviations
lx
xi

Note on romanisation
Introduction: The developmental alliance and Korean development
1
13

Prologue: a new beginning? 1 Power and political economy in Korea 4 The
dynamics of the developmental alliance 6 Overview of the book 9
1 Korea in the political economy literature
Introduction 13