Property Rights, Development, and Financial Markets in South Korea

Abstract

Property-rights describe the rights individuals have over material and immaterial goods. From the point of view of the property rights approach, a financial market is primarily a market for "rights to exchange something (money) for goods". Efficiency in this market depends largely on the information available to intermediaries like banks and other financial institutions. Regulation of financial markets was at the heart of Korea's economic strategies for more than two decades. Here, the distribution of property-rights by the government was supporting export industries and at the same time hindering balanced development of the economic structure.