On the Relevance of the German Concept of "Social Market Economy" for Korea

(South) Korea has reached a critical stage in its economic development. Per-capita income has reached a rather high level, but social cohesion and politically enforced coercion, which were critically important for past growth, are fading away. Moreover, liberties and freedom will be important for creativity to flourish, which in turn is vital for future economic growth. This raises the question of the future social frame of the economy, because if this frame is not taken care of, the free and unchecked market economy may severely undermine the development process. In this context it is important to monitor how other countries dealt with the issue. The paper is organised into 3 major parts, apart from this introduction. In part 2, the concept of "Social Market Economy" as developed in post-war Germany and its implementation are presented. In part 3, the Korean situation is covered in some more detail. It will be shown that Korea's economy is at a cross-roads where SME experience is indeed relevant. In the 4th and final part, some lessons from SME experience for Korea are discussed.


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Duisburg Working Papers on East Asian Studies


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