KOREAN ECONOMY. Rm# 311, College of Business and Economics

Transcription

1 KOREAN ECONOMY CREDIT INSTRUCTOR Professor Doowon Lee OFFICE Rm# 311, College of Business and Economics OFFICE HOURS TIME 3:20~5:00 CLASSROOM LOCATION T.A.: Haemi Pak / Heejin Kim * Please leave the fields blank which haven t been decided yet. [COURSE INFORMATION] COURSE DESCRIPTION & GOALS PREREQUISITE The purpose of this course is to improve the understanding of the Korean and the other East Asian economy in the global perspective. Also, in doing so, the instructor will help the students to enhance their knowledge about theories of macroeconomics, international trade and economic development in the light of the Korean and the other East Asian experiences. Upon reviewing major models of economic development, this course will examine the century-old economic development of Korea and East Asia. Most of the emphasis will be given to the period after the WWII. The first half of the course will be devoted to review the evolution of the Korean economy during the last several decades in comparison with other East Asian economies. Major characteristics as well as the most important policy change of each decade will be explained. During the second half of the course, more specific topics such as macroeconomic management, fiscal and monetary policy, role of financial market, firms and industrial policy, external economic relation, and social issues will be studied. In each subject, relevant theoretical backgrounds will be introduced. Also, international comparisons based on various sources of references will be made as much as possible to enhance the understanding of the lectures. One or two lectures can be conducted by invited speakers. Students are expected to read required reading materials (those with ** ) and encouraged active participation in the class. The instructor will often ask questions to students, and will encourage students to raise questions. In the end of the semester, each group of students will make a presentation in the class. The topic of the presentation can be anything that is related to the Korean economy. Each group would be composed of 7 to 10 students. Principles of Microeconomics & Principles of Macroeconomics

2 COURSE REQUIREMENTS GRADING POLICY TEXTS & REFERENCES INSTRUCTOR S PROFILE - Mid-term exam: 30% - Final exam: 30% - Class attendance: 10% - Presentation: 30% Lecture materials will be uploaded in the YSCEC hompage ( You can download the files. Doowon Lee Professor, School of Economics, Yonsei University, Korea Office address: Room 311, Daewoo Hall T.A. Haemi Pak Office address : Room 301, Daewoo Hall hmpak@yonsei.ac.kr [LY SCHEDULE] * Your detailed explanations would be very helpful for prospective students to get a pre-approval for credit-transfer from their home university in advance. June 30 (Tue) Quiz on Economics and Korean Economy & Introduction of Key Terminologies Introduction (1) Introduction of class schedules and references 1 (06.30 ~ 07.02) Refer to (world economic outlook database) for macroeconomic data of IMF member countries. Also, refer to (the world fact book) for a brief description of geographical, political, social and economical situation of countries worldwide. Also, refer to World Bank ( ADB (

3 Penn World Table: OECD ( OECD Economic Surveys Korea), UN ( The Economist ( Financial Times ( For Korean references, refer to Bureau of Statistics ( Bank of Korea ( KOTRA ( KITA ( KIEP ( July 1 (Wed) Review of Economic Development Theories (1) Linear Stage Theory of Rostow & Harrod- Domar Model (2) Dual Economic Structure Model of Lewis, Fei and Ranis ** Chapter 3 of Michael Todaro and Stephen C. Smith, Economic Development, 9 th Edition, (Pearson Education Limited, Harlow, England, 2006). July 2 (Thu) Review of Economic Development Theories: continued Part II. Evolution of the Korean and East Asian Economies 2 (07.06 ~ 07.09) July 6 (Mon) Brief Overview of the Korea Economy July 7 (Tue) Before Industrialization: Pre-modern Society, Opening, and the Colonial Legacy: Comparison between Korea and Japan July 8 (Wed) **Ch. 1 (An Overview of Industrial Development During Japanese Colonial Rule, ) of Kim, Kwang-Suk, and Michael Roemer, Growth and Structural Transformation, Harvard University Press, Cambridge, 1979

4 Beginning of Industrialization: Import Substitution Policies (1) Import Substitution Policy (2) Dominant Role of the foreign Aids **Fei, John, Gustav Ranis, and Kazushi Ohkawa. Economic Development in Historical Perspective: Japan, Korea and Taiwan, in Japan and the Developing Countries, Edited by Kazushi Ohkawa and Gustav Ranis, London: Basil Blackwell (1985) 3 (07.13 ~ 07.16) July 9 (Thu) The Export Promotion Policy of the 1960s(I) (1) IS (Import Substitution) vs EP (Export Promotion) (2) Transition to EP policy July 13 (Mon) The Export Promotion Policy of the 1960s(II) (1) Five Year Economic Development Plans (2) International Comparisons: Japan, Southeast Asia and Latin America July 14 (Tue) The Secondary IS Policy: Heavy and Chemical Industry (HCI) Drive (1) Backgrounds of the HCI Drive (2) Achievements and Side-Effects of the HCI Drive **Ch. 3 (The Transition to an Export-Oriented Economy: 1961 to 1965), Ch. 4 (Emergence as a Major Exporter: 1966 to 1975), and Ch. 5 (The Allocative Efficiency of Trade and Aid) of Krueger, Anne, Harvard East Asian Monographs 87, Studies in the Modernization of The Republic of Korea: , The Development Role of the Foreign Sector and Aid, Harvard University Press (1982). **Ch 3 (The ABCs of Japanese and K Accumulation) of Amsden, Alice H. Asia s Giant: South Korea and Late Industrialization (O University Press, 1989, pp ) ** Ch. 6 (Foreign Trade and the Incentive System) and ** Creating an Export Push of Ch. 3 of World Bank, The East Asian Miracle: Economic Growth and Public Policy, A World Bank Policy Research Report (Oxford University Press, 1993). **Ch. 2 (Macroeconomic Policy through the First Oil Shock, ) and Ch. 3 (From the Heavy Industry Plan to Stabilization: Macroeconomic Policy, ) of Haggard, Stephan, Richard N. Cooper, Susan Collins, Choongsoo Kim and Sung-Tae Ro, Macroeconomic Policy and Adjustment in Korea: (Harvard institute for International Development, 1994). Ch. 17 (The Heavy and Chemical Industries

5 Promotion Plan) of Cho, Lee-Jay and Yoon Hyung Kim, Economic Development in the Republic of Korea (University of Hawaii Press, 1991) (3) Comparison with Taiwan and Japan (4) Overcoming the Oil Shocks **Ranis, Gustav, The Political Economy of Development Policy Change: A Comparative Study of Taiwan and Korea KDI Working Paper No (1989) July 15 (Wed) Liberalization and Structural Reforms of the 1980s: From 3 Highs to 3 Lows(I) (1) Stabilization Policies (2) Structural Reforms and Trade Liberalization **Ch. 4 (The Political Economy of Adjustment in the 1980s) of Haggard, Stephan, Richard N. Cooper, Susan Collins, Choongsoo Kim and Sung-Tae Ro, Macroeconomic Policy and Adjustment in Korea: (Harvard institute for International Development, 1994). Mid-Term Examination : July 16 (Thu) 4 (07.20 ~ 07.23) July 20 (Mon) Liberalization and Structural Reforms of the 1980s: From 3 Highs to 3 Lows(II) (1) Favorable External Environments and 3- lows (2) Democratization and the Korean Economy The Early Half of the 1990s: Growth through High-Costs and Low-Efficiency Economic Structure **Cheng, T. J. and Lawrence Krause, "Democracy and Development: With Special Attention to Korea," The Journal of Northeast Asian Studies (1992) **Doowon Lee, "Korea's Development Strategy Changing International Environment: Three Past and Present," Korea Observer: A Qua Journal, Vol. 23, No. 4, pp , Winter 199 **Chopra, Ajai, Kenneth Kang, Meral Karasulu, Liang, Henry Ma, and Anthony Richards ( From Crisis to Recovery in Korea: Str Achievements, and Lessons, IMF Working Pap 01/154). July 21 (Tue) The 1997 Asian Financial Crisis (1) Causes and Recovery of the Crisis ** Cho, Yoon Je, Economic Adjustment Progr Korea After the Crisis: What Have We Learned

6 (2) Implications and Side-Effects the Korean Economic Adjustment Program?, K Crisis and Recovery, edited by David T. Coe an Jik Kim, IMF & KIEP (2002) (3) International Comparisons July 22 (Wed) The 2008 Global Financial Crisis and East Asia Part III. Sectional Analysis of the Korean Economy **Reinhart, Carmen M and Kenneth S. Rogoff Equal Opportunity Menace, American Eco Review (2008). *Refer to (International Mo Fund). 5 (07.27 ~ 07.30) July 23 (Thu) Macroeconomic Management (1) Macroeconomic Management of East Asia (2) Macroeconomic Balance and Saving/Consumption Hypotheses (3) Capital Accumulation and Investment July 27 (Mon) Fiscal Policy (1) Effect of Fiscal Policy (2) Structures of Tax Revenues and Government Expenditures (3) Problems and Challenges **Ch 3 (Macroeconomic Stability and Export Gr of World Bank (1993) **Ch 5 (Strategies for Rapid Accumulation) of Bank (1993) *Refer to (Na Bureau of Statistics of China) for the C statistics. **Ch. 5 (Fiscal Policy in Korea) of Haggard, Ste Richard N. Cooper, Susan Collins, Choongsoo and Sung-Tae Ro, Macroeconomic Policy Adjustment in Korea: (Harvard institu International Development, 1994) **Feyzioglu, Tarhan, Michael Skaarup, and M Syed, Addressing Korea s Long-Term Challenges IMF Working Paper, WP/08/27 (200 *Refer to (Ministry of Strateg Finance) and (Korea Institute of Finance). July 28 (Tue) The Financial Market (1) The Role of Financial Sector in Economic **Summary & Ch. 3 (The Evolution of Fin

7 Development (2) The Korean Financial Market Structures and Reforms (3) International Comparisons of the Financial System Market Structure and Industrial Policy (1) Market Structure and Concentration of Economic Power: issue of Chaebol (2) Industrial Policy Sector Policies and Directed Credit Program Korea) of Cho, Yoon Je and Joon Kyung Kim, Policies and the Industrialization of Korea (December 1997) * Refer to (Bank of K (Ministry of Strategy and Fin and (Korea Institute of Finance) Ch. 7 (Industrial Structure and Policy) and Ch. 11 (Understanding the Korean Management System) of Song (2005). ** Leipziger, D. M. and Peter A. Petri, Ch. 19 Korean Industrial Policy: Legacies of the Past and Directions for the Future of Cho and Kim (1994). ** Ch. 1 (Introduction) of Komiya, Ryutaro, Masahiro Okuno, and Kotaro Suzumura, Industrial Policy of Japan (Academic Press, 1988). * Refer to (Fair Trade Commission), Korea Economic Research Institute ( an affiliation of the Federation of Korean Industries ( Also refer to (Ministry of Knowledge Economy) and (Small and Medium Business Administration). July 29 (Wed), July 30 (Thu) The North Korean Economy and Inter- Korean Economic Relation (1) The Evolution of the North Korean Economy (2) Recent Status and Prospects for Change (3) Inter-Korean Economic Relation (4) Unification Scenarios and Unification Cost (5) Comparison with German Unification ** Ch. 8 (The Implications of North Korean Collapse) of Noland, Marcus, Avoiding the Apocalypse (2001). * Refer to (Ministry of Unification), The world factbook of 6 (08.03 ~ 08.06) August 3,4 (Mon, Tue) Presentation by student group August 5: Review and Q&A on Final

8 Examination August 6: Final Exam Final exam will be taken at the classroom