Name: Taylor Period:
Case Study: South Korea
Population: 51,844,834 (2022 est.)
Life Expectancy: 82.97 years (2022 est.)
Freedom Index: 74.6, 19th in the world with the United States
ranked 25th.
Economic Overview:
South Korea has made incredible strides in its economy in the last 60
years. After emerging from the 1950-53 war with North Korea, South
Korea quickly became a developed, globally connected,
high-technology society. From the 1960s, South Korea's government
promoted the import of raw materials and technology, encouraged
saving and investment over consumption, and kept wages low in
order to direct resources to export-oriented industries.
This led to years of economic growth, and propelled South Korea into
the ranks of the most advanced economies in the world by 1997. These policies also led to the emergence
of family-owned chaebols (large corporations) such as Hyundai, and Samsung, which retained their
dominant positions even as the government loosened its grip on the economy.
However, the financial crises of the 90’s and 00’s hit South Korea’s companies hard. South Korea tackled
difficult economic reforms following the crisis and had a relatively rapid economic recovery. South Korea
will continue to contend with slowing economic growth, and will need to address challenges such as its
rapidly aging population, inflexible labor market, and heavy reliance on exports rather than domestic
demand for products. Other economic problems persist, and include rising inequality, poverty among the
elderly, high youth unemployment, long working hours, low worker productivity, and corruption.
Major Industries: electronics, telecommunications, automobile production, chemicals, shipbuilding,
steel
Major Exports: Computer chips, cars and vehicle parts, refined petroleum, ships, office machinery
(2019)
Economic System:
South Korea has a mixed economy which combines
elements of both market capitalism and state
control. It has a very competitive business
environment and is one of the world's top
performing economies. The government provides a
range of services such as education and healthcare,
while private enterprise is responsible for the
majority of production and investment. The
government has also implemented policies to
promote innovation, such as providing incentives for research and development. South Korea has a highly
developed infrastructure and is heavily dependent on exports, with much of its economic growth coming
from the export of manufactured goods.
Guided Questions: Use your notes and information from the case study to answer the questions. Type
your answers into the boxes provided.
1. How does South Korea's economic system promote economic growth?
No government interference
2. How has South Korea's economic system contributed to the success of family-owned chaebols?
“The government provides a range of services such as education and healthcare, while private
enterprise is responsible for the majority of production and investment.”
3. What are some of the challenges that South Korea is facing in terms of economic growth?
“South Korea has a mixed economy which combines elements of both market capitalism and
state control. It has a very competitive business environment and is one of the world's top
performing economies.”
4. How have South Korean government policies encouraged innovation in the economy?
“From the 1960s, South Korea's government promoted the import of raw materials and
technology, encouraged saving and investment over consumption, and kept wages low in order
to direct resources to export-oriented industries.”
5. How has South Korea's reliance on exports impacted its economy? Use the terms supply and
demand in your answer.
“However, the financial crises of the 90’s and 00’s hit South Korea’s companies hard. South
Korea tackled difficult economic reforms following the crisis and had a relatively rapid
economic recovery.” their supply went low and demand went up
