정현형key concept 9

정현형k...

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1. Miracle on the Han River - ( M  “ * ) is a catchphrase used to describe the period of rapid economic growth that took place in South Korea following the Korean War up until the Asian Financial Crisis. In particular, this phrase is often used to describe the growth of Seoul — through which the Han River flows — from a city virtually levelled by war to a major economic hub, and the growth of South Korea into one of the Four Asian Tigers. “Miracle on the Han” is obviously borrowed from “Miracle on the Rhine” — a phrase that predates the Korean catch phrase by decades and described the economic rebirth of (West) Germany after World War II. Background of Y M   - After the war ended, South Korea had two-thirds of the population of the Korean peninsula to make a living on one half of the land. In economic terms, this political divisioning separated raw materials, resources, production facilities, and markets. North Korea was the site of many natural resources while South Korea had many light industries. South Korea had no significant exports. South Korea was at the bottom of the international income scale. In addition, it was burdened with maintaining a large standing army. High defense expenditures were necessary to match the advanced weaponry of the North. Indeed, since the Korean War ended, and estimated one- third of the national budget had been earmarked each year for defense spending. The economic progress that Korea has achieved since 1962 has remarked, not only in rebuilding a nation that was devastated by foreign domination and war, but in addition Korea is heavily dependent on import s for almost all of its raw materials and energy. In 1961, Korea's per capita GNP was $82. In 1962 with all the odds against him, President Park announced the first Five Year Plan and proclaimed that working together, Koreans could create their own "Miracle on the Han River". Plans were laid for the future. Constructive options for achieving this miraculous national economic recovery were developed. 2. “Getting prices wrong” Background: IN THE 1950s, India and South Korea had approximately similar levels of per capita incomes. In the following two decades, Korea grew at rates far exceeding those of India, achieving a much higher per capita income level than the latter.
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During the same decades, Singapore, Taiwan and Hong Kong grew at rates even higher than that of Korea. Precise source of the success of these countries, sometimes called the Asian tigers, has been a subject of considerable controversy among scholars. One of the view is “getting prices wrong” Explanation: In fact, through East Asia and elsewhere, all governments in countries that compete without new technology have used subsidies deliberately to get relative prices "wrong" to stimulate investment and trade. The East Asian countries have not grown faster because they have bowed more deeply at the altar of free markets. They have grown because they did not hesitate to distort prices from what they would have been if the forces of supply and demand
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정현형k...

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