1. Did the Financial Crisis Transform the East Asian Developmental State?: Focused on the Public Fund in Korea.
- Author
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Lew, Seok Choon and Wang, Hye Suk
- Subjects
FINANCIAL crises ,POLITICAL autonomy ,DOMESTIC markets ,PUBLIC finance - Abstract
The Asian financial crisis in 1997 triggered the fierce debates over the validity of Korean developmental state model. Some scholars argue that the demands of global agents undermine the state autonomy and capacity. The state, facing the crisis, could not help accepting the financial aids from international organizations, which in return, demanded the neo-liberal economic transformation favorable to them. For them, the state is doomed to lose its own room to maneuver the domestic market, which means the end of the developmental state. Others insist that the crisis paradoxically provides an opportunity to strengthen the state autonomy and capacity. According to them, the state becomes the only fundamental body responsible for concluding an entente with the foreign organizations and meeting their needs. In this context, this paper tries to answer this controversial question: "Has the financial crisis transformed the developmental state?" This paper examines the transformation of the Korean developmental state during the so-called "IMF regime," based on the concept of the state autonomy and capacity. This paper focuses on the public fund, of which role was critical in overcoming the financial crisis. The public fund was an emergency financial measure given to the hands of the state under the name of overcoming the crisis and restoring the economy.This study champions the importance of positive and proper intervention of the state. As seen in the case of public fund in Korea, the failures in restructuring process are not because of the state intervention but because of the improper intervention of state. Moreover, it traces the continued characteristics of the developmental state which have been criticized as the main cause of the financial crisis in 1997. The path the crisis is overcome cannot be separated from the path the crisis is formed. Such a historical and social continuity in Korean society could not be transformed in spite of the financial crisis and now calls for the reappreciation on the East-Asian developmental state in the age of global transformation. [ABSTRACT FROM AUTHOR]
- Published
- 2008