Financing Export-Oriented Catching-Up in Korea: Credit-Rationing, Sustained High Growth and Financial Chaos
In the 1960s and 1970s, bank credits were rationed essentially on the basis of firm's export-performance in Korea. Financial institutions did not have the ability to properly evaluate prospective entrepreneurs and potentially high return projects. It was cost-quality competition at the international export market that screened firms for efficiency, and this natural selection process of the fiercely competitive international market compensated for the backwardness of the Korean financial sector, thereby enabling Korea's sustained high growth. Credit-rationing on the basis of firm's export performance very much overcame the adverse selection problems in credit markets. Since the early 1980s, however, bank credit has been rationed less and less in proportion to export performance, while the nominal financial liberalization has failed to develop the Korean financial sector. This may explain the financial chaos in the 1990s.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 12 (1998)
Issue (Month): 1 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/RIEJ20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/RIEJ20|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Fry, M.J., 1993. "Financial Repression and Economic Growth," Papers 93-07, University of Birmingham - International Financial Group.
- Hong, Wontack, 1986. "Institutionalized monopsonistic capital markets in a developing economy," Journal of Development Economics, Elsevier, vol. 21(2), pages 353-359, May.
- Dornbusch, Rudiger & Reynoso, Alejandro, 1989.
"Financial Factors in Economic Development,"
American Economic Review,
American Economic Association, vol. 79(2), pages 204-09, May.
When requesting a correction, please mention this item's handle: RePEc:taf:intecj:v:12:y:1998:i:1:p:141-153. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.