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The Political Economy of Korean Government Policies on Real Estate

Author

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  • Chung-Ho Kim

    (Korea Centre for Free Enterprise, Do-Won Building, 290-20 Dowha-Dong, Mapo-Ku, Seoul, South Korea, kch@cfe.org)

  • Kyung-Hwan Kim

    (Department of Economics, Sogang University, C.P.O. Box 1142, Seoul, South Korea, kyungkim@ccs.sogang.ac.kr)

Abstract

This paper investigates the driving forces behind the Korean government's real-estate policy decision-making. In particular, it tries to explain why inefficient and inequitable policies have persisted for so long, and why policy reform has been so sluggish. In order to do this, a few key regulations governing housing supply and land use are described and evaluated. These are the price control on new apartments, control on land-use conversion, green belts and spatial deconcentration policies. Next, it is demonstrated that the standard economic theory of interest-group politics is not appropriate in explaining the behaviour of the government officials in charge of these regulations. It is then suggested that a piecemeal and lukewarm approach to policy reform could be better understood in light of the behaviour of risk-averse government officials taking the political ramifications of their decisions very seriously.

Suggested Citation

  • Chung-Ho Kim & Kyung-Hwan Kim, 2000. "The Political Economy of Korean Government Policies on Real Estate," Urban Studies, Urban Studies Journal Limited, vol. 37(7), pages 1157-1169, June.
    • Handle: RePEc:sae:urbstu:v:37:y:2000:i:7:p:1157-1169
    DOI: 10.1080/00420980020080071
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    References listed on IDEAS

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    Cited by:

    1. Kyungwon Kim & Jae Wook Song, 2018. "Managing Bubbles in the Korean Real Estate Market: A Real Options Framework," Sustainability, MDPI, vol. 10(8), pages 1-25, August.
    2. Woongkyoo Bae & UnHyo Kim & Jeongwoo Lee, 2019. "Evaluation of the Criteria for Designating Maintenance Districts in Low-Rise Residential Areas: Urban Renewal Projects in Seoul," Sustainability, MDPI, vol. 11(21), pages 1-20, October.
    3. Richard K. Green & Susan M. Wachter, 2007. "The housing finance revolution," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, pages 21-67.
    4. Kyung-Hwan Kim & Miseon Park, 2016. "Housing Policy in the Republic of Korea," Working Papers id:10751, eSocialSciences.
    5. Kim, Kyung-Hwan & Park, Miseon, 2016. "Housing Policy in the Republic of Korea," ADBI Working Papers 570, Asian Development Bank Institute.

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