What Made Possible the Korea’s Economic Miracle? : Park Chung Hee’s Economization of Politics, Economic Discrimination and Corporate Economy

Abstract

This paper attempts to dispel the myths about Korea’s development policies and achievements during the developmental era led by the late President Park Chung Hee (hereafter Park), and to learn about his political economy leadership, which made the Korean economic miracle possible. As many of his development policies were non-orthodox, mainstream economics and political science academia and the opposition political circles have heavily criticized his political economy regime. Therefore, the paper introduces a new general theory of economic development to serve as an analytical basis for objectively reevaluating Park’s policies and achievements. The new theory states that the economic discrimination policy of “rewarding high performance and penalizing low performance” is necessary for economic development, while egalitarianism, disregarding high performance, is sufficient for economic stagnation. The paper then reinterprets Korea’s development history over the last 60 years by highlighting that Korea’s Han-river miracle was led by Park’s firm adherence to the economic discrimination principle, while the current economic growth slowdown is due to the egalitarian policies rewarding the low performance. The paper then explains how Park succeeded with non-traditional approaches. Finally, the paper concludes that Park made the Korean economic miracle possible by implementing “economic discrimination” policies via adopting “economization of politics” under authoritarian democracy and thereby achieving “corporate-led growth” under the ideology of a capitalist corporate economy.