Finance and Growth of the Korean Economy from 1960 to 2004

Abstract

In this paper I overview the relation between finance and

growth of the Korean economy from the year of 1960 to that of

2004 through the literature survey. Financial regimes of

liberalization and those of repressions alternated each other

during this period. However, economic growth continued

independently of the various financial regimes. Financial

deepening, as well as an increase in the variety of financial

instruments, accompanied an increase in per capita income. In

particular, it is observed that a peak growth rate of the trade

balance lagged behind eight to ten years that of investments. In

the interval of these two peaks occurred the financial distresses.

Possible scenarios for investment financing role of exports are

suggested.