The Korean Economy with Slow Growth

This chapter examines South Korea's economic and social trajectory from the 1997 Asian financial crisis to the present. The crisis marked a turning point, triggering profound structural reforms across core sectors, including corporate governance, financial systems, labor markets, and public administration. After evaluating the immediate impacts of the crisis, the chapter analyzes its enduring consequences, notably marked by a slowdown in economic growth and a significant rise in income inequality—sharply contrasting the preceding era of rapid growth and relative equality. The chapter also investigates the growing public demand for equitable income redistribution through progressive taxation and expanded fiscal policies. In this context, Korea’s welfare expenditures are compared with those of other countries to evaluate the evolution of its welfare system in a global context. By analyzing these developments, the chapter highlights how the post-crisis era has redefined Korea’s economic priorities and social policy landscape.