The Evolution of Infrastructure Investment of Korea

Abstract

Although analysts have explored many facets of economic growth of Korea over the last decades, infra structure investment policies have been discussed in terms of a simple developmental state framework that emphasizes the role of bureaucracy. This paper claims that infrastructure investment is a function of interactive processes affected by demand, supply, politics, and administrative reaction. While the Korean government did invest in infrastructure in advance of the growth of demand for it in the 1970s, it has made its major infrastructure investment since the 1980s. Also, while strong political leadership is frequently lauded, the problems with the Gyeongbu expressway and the four-rivers project suggest that political leadership without adequate rational planning and policy analysis can have undesirable effects. Finally, facing budget constraints and pressure to make efficient use of limited resources, the Korean government has sought to institutionalize a systematic process for managing infrastructure investment. Hence, the development and utilization of relevant policy analysis and evaluation methods is necessary.