A Socio-Political condition for lndustrial Policy and Financial Repression in Korea

A Socio-Political condition for lndustrial Policy and Financial Repression in Korea

Economic orthodoxy, which stresses primarily the efficiency of liberal financial regimes, tends to miss the complexity and potential of social control over financial systems. Similar credit policy and programmes can lead to quite different economic results in different socia-political contexts. This paper discusses how it was possible for the Korean working population to tolerate the expenses for those policies (as a main condition of valid industrial and credit policy) and, how the political justification in using public money to cure market failure failed (as a fundamental condition of recent seemingly systemic entanglement of policies). It is worth emphasizing that the socio-political background has not simply been given from the history but influenced and established by policy and economic development themselves.