Abstract
The purpose of this paper is to explore some salient characteristics of the Korean economy in historical context and to appraise the role of foreign influences in changing the economic structure of Korea since the beginning of Western influence. First, the historical background will be briefly surveyed in terms of evidence of the changes in factor supply, categorized as capital (especially social overhead capital), labor, land, and entrepreneurial factors. The causes of change will be identified with emphasis on causes external to the economic system. Second, the pattern of structural change and the nature of “disequilibrium” will be described and explained. The following items will be relevant for our consideration: dual structure, changes in output composition and occupational distribution, external disequilibrium (i.e., deficits in the balance of international payments, foreign aid), financial disequilibrium (i.e., deficit financing of the government, inflation, overvalued currency), and structural disequilibrium (i.e., unemployment, excess capacity in some sector of the economy). The conclusion summarizes our discussion briefly and speculates on Korea's economic future.
