Crisis of the Developmental State in South Korea

The South Korean government is currently undergoing what some claim to be the most extensive restructuring of its structure and functions. Unlike previous restructuring efforts, this series of reorganizations have an added urgency due to the watchful eyes of the International Monetary Fund after South Korea signed a Stand-by Agreement on December 3, 1997 to alleviate itself of the financial crisis.

This paper examined the extent to which the developmental state has successfully restructured itself compared to an ideal type of a government in a “freer” market economy. Results from a study of the two government-restructuring plans show a limited change in the developmental state. The findings imply that there have been shifts in the balance of power among the economic ministries, but not a fundamental restructuring of the developmental state.