Miracle of the Han River - Rise of South Korean Economy Post Korean War

MIRACLE ON THE HAN RIVER

 RISE OF SOUTH KOREAN ECONOMY POST KOREAN WAR

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Contents

Abstract        

Introduction        

The Post-War Economy        

Lack of Economic Development during 1950’s        

PARK CHUNG-HEE        

Third Korean Republic (1963 – 1972)        

Fourth Korean Republic (1972 – 1981):        

The 1980’s        

Pillars of the Korean Economy:        

Dark Side of the Miracle        

Epilogue        

References:        

Abstract

The Miracle on the Han River refers to South Korea’s post-war economic growth, with rapid industrialization, technological advancement, rise in living standards, education boom & overall modernization of the nation such that it went from being one of the poorest countries of the world in 1950’s to being an economic powerhouse & OECD member in 1996. The term “miracle” generally refers to the period of 1961 to 1996. The phrase has its source in the “Miracle on the Rhine”, the economic rebirth of West Germany after the Second World War. Han river, the fourth-largest river n the Korean peninsula, has been of historical importance to all Korean kingdoms & is the life-blood of the city of Seoul.

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The particular period from 1962-89 brought a revolutionary transformation in the South Korean economy. It was achieved through an export oriented industry-led strategy, consistent investment in the education sector & the grand successes of the Chaebols, many of which went on to become global industrial giants. The large scale conglomerates developed in the 1970’s & went on to achieve economies of scale & technology and gained international competiveness. By the early 1980’s, this industry focussed approach gave rise to major imbalances in the economy, which could be seen from the repression of small & medium scale industries, a weak financial sector & heavy domestic market concentration. Despite the attempts at economic freeform, these structural deficits proved to be particularly devastating in the Asian financial crisis of 1997-98. This is generally considered to be the end of the miracle.