The changing dynamics of state-business relations and the politics of reform and capture in South Korea
- Authors
- You, Jong-sung
- Issue Date
- Jan-2021
- Publisher
- ROUTLEDGE JOURNALS, TAYLOR & FRANCIS LTD
- Keywords
- Chaebol; Samsung; capture; inequality; corporate governance; state-business relations; developmental state; South Korea
- Citation
- REVIEW OF INTERNATIONAL POLITICAL ECONOMY, v.28, no.1, pp.81 - 102
- Journal Title
- REVIEW OF INTERNATIONAL POLITICAL ECONOMY
- Volume
- 28
- Number
- 1
- Start Page
- 81
- End Page
- 102
- URI
- https://scholarworks.bwise.kr/gachon/handle/2020.sw.gachon/26461
- DOI
- 10.1080/09692290.2020.1724176
- ISSN
- 0969-2290
- Abstract
- The Choi Soon-sil scandal, which led to the arrest of the de facto leader of Samsung Group Lee Jae-yong and the impeachment of President Park Geun-hye, exposed the ugly features of state capture in South Korea. Although the 1997-1998 financial crisis highlighted the problems of crony capitalism, it has been widely recognized that South Korea overcame the crisis by implementing far-reaching reforms of the chaebol's corporate governance. This article explores why the post-crisis reform failed to end the practices of crony capitalism and why global companies like Samsung engaged in such corruption through a historical case study of Samsung Group. It highlights how increasing inequality and chaebol concentration have produced both popular pressures for institutional reform and incentives for chaebol to capture the policy-making process in the context of the changing state-business-civil society relations in the democratic post-developmental state era. I find that while the main objective of the chaebol's bribery and lobbying of the government before the financial crisis was business expansion through the acquisition of low-interest loans and other government favors, it has changed to weakening or circumventing government regulations on corporate governance in order to achieve easier and cheaper dynastic successions of corporate control.
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