The Two Sides of Korean Administrative Culture

Competitiveness or Collectivism?

Tobin Im

• Publisher: Routledge
• Year: 2019
• Print ISBN: 9780367150136
• eBook ISBN: 9780429623325
• Topic: Business
• Subtopic: Business General
• Index: Business

This book explores two contradictory aspects of the Korean culture: competitiveness and collectivism. These two major concepts describe the dynamics of Korean public organizations, which explain the Hangang River Economic Miracle and political democratization. However, not many studies have focused on how competition within the central government, that is, competition among different agencies, has led to an overall competitive government. This book attempts to do so and explains how competition contributed to the rapid economic growth of Korea.

1 Competition

A novel concept?

This introductory chapter will discuss an underlying mechanism of Korea’s rapid economic growth and political miracles in the 1960s–1980s. Competitiveness and collectivism are constructed as new concepts that identify the main sources of these major accomplishments, and these two concepts will be demonstrated through the state’s crucial role in managing through postwar adversities. The state’s role will be emphasized by the significance of bureaucratic coherence in implementing public projects, along with increasingly important citizen participation since democratization.

Explanatory factors of the Korean Miracle

Many developing countries have long envied Korea for its Miracle on the Han River. The Miracle on the Han River refers to the period of rapid economic growth in South Korea following the Korean War (1950–1953), during which South Korea transformed from a developing country to a developed country. Numbers show that Korea’s gross domestic product (GDP) has increased 386 times from 4 billion United States Dollars (current USD) in 1960 to USD 1.5 trillion in 2017. GDP per capita has also skyrocketed 188 times from USD 158 in 1960 to USD 29,743 in 2017. The country has radically transformed from a war-ruined country into an economic powerhouse in the last few decades. Its economy grew explosively at a two-digit GDP annual growth rate: for most years from 1966 to 1991, the annual GDP growth rate marked somewhere between 10% and 15%. The country’s economy has experienced a major leapfrog from exporting raw silk and iron ore, and making light products such as wigs and textiles in the 1960s to producing consumer electronics, oil tankers, and semiconductors since the 1990s. There are a few descriptive pieces of literature that demonstrate past accomplishments of the Korean economy, but there is no convincing explanation of factors other than leadership as well as the Korean bureaucracy’s role in the mobilization of resources (Chibber, 2002: 961). Foreign financial aid has been the greatest part of universally accepted theories of economic development in developing countries, but it has not always helped countries in the desired way.

The so-called Dutch disease¹ and the resource curse or cure² are two extreme theories that clearly show the limitation of resource factors. There is at least one important missing factor that encompasses all other variables in previous ideas. Another miracle of Korea that is not as well-known as the economic one is its rapid political democratization. Most developed countries had developed their democracy over hundreds of years. In contrast, the Korean democracy has developed in just three or four decades, which is much shorter than in other countries. The people’s aspiration for freedom and democracy under the prolonged authoritarian dictatorship from Park Chung-hee to Chun Doo-hwan (1961–1987) had grown. The transition to a democratic political system from military government was achieved by numerous anti-government demonstrations and collective actions of the people. Eventually, the direct presidential election which had long been demanded by demonstrators was held in 1987.

This book deploys competitiveness and collectivism to better understand Korean miracles. While competitions are essential traits that may have contributed to such economic growth, their significance has not been discovered yet. Competitiveness and collectivism together will explain the dynamics of Korean public organizations, which include the Miracle on the Han River and political democratization. We will shed light on these two major concepts to understand the state having managed through postwar adversities and having mobilized appropriate resources at proper times. State have also accommodated bureaucratic coherence in implementing these public projects and later kindled increasingly important citizen participation upon democratization.

Before discussing how competitiveness and collectivism have affected the economic growth, this chapter will briefly review previous ideas about economic growth in most developing countries. Then the chapter will proceed to key psychological variables of our interest. While the discussion will not nullify prevalent ideas from existing literature, it will provide a more wholistic perspective on Korean society and its constituents. Researchers in economics and sociology have already developed economic factors as well as cultural and institutional factors, but adding psychological factors as moderating variables will enrich their explanations on economic achievements. Competitiveness and collectivism may also be independent variables that directly affect the economic growth. Later chapters that explore theoretical backgrounds of competitiveness and collectivism will also elaborate on this potential causal relationship.

Conventional explanations on economic development

Not many pieces of literature have discovered the underlying mechanism of Korea’s rapid economic growth. Extant explanations from various academic disciplines largely remain insufficient to the extent that many of them simply describe development processes or suggest economic and demographic variables as major contributing factors. Therefore, most economic development research articles, not specifically focusing on Korean cases, have appeared in economics and sociology academic journals. Lucas (1988), an economist, proposed neoclassical econometric models involving physical capital accumulation, technology changes, and human capital accumulations to explain economic developments in different countries. Lucas adopted the neoclassical economic growth view of Robert Solow and Edward Denison.

Some research, however, such as Granato et al. (1996) and Swank (1996), has suggested culture and institutions as potential explanatory variables of economic growth. Granato et al. (1996) associated with Weber’s Protestant cultural attitudes on economic achievement and thrift with positive economic growth. Also included in the analysis were postmaterialist³ values negatively associated with economic growth, and these cultural values had been listed in the World Values Survey that asked the public which social qualities are important for their children (Granato et al., 1996: 611). The authors specifically mention McClelland’s works on achievement motivation that had been indirectly identified throughout the culture via storybooks and schoolbooks for children (Granato et al., 1996: 610). The achievement motivation turned out to be positively associated with the economic growth rate (1960–1989), and three East Asian countries, Korea, Japan, and China, were the top countries with the highest economic growth rate and high achievement motivation scores (Granato et al., 1996). While these authors agreed that in the short-term technology, shocks are likely to be the main component of economic growth, they argue that cultural factors and political, economic institutions are critical explanatory variables that may interpret the difference between South and North Korea’s economic growth (Granato et al., 1996: 607–608).

Building upon Granato’s assertion, Swank found out that the variation of the 30-year growth rates of 25 countries was largely explained by human capital investment along with communitarian polities (Swank, 1996). The communitarian polities, which Swank proposes to include the Confucian statist institution of East Asian countries and Northern Europe’s social corporatist structures, tend to praise collective organizations and group membership as facilitating developments in organizations (Swank, 1996: 669). These factors often mitigate rent-seeking behaviors or free-riding problems from individuals’ selfish intentions, and they instead promote concertation and consensus within an organization (Swank, 1996: 669–670), making the mobilization of human resources (organization members) more convenient for policy implementers. These findings imply that the cultural and institutional contexts of a country may influence how economic growth can be driven amid more obvious economic input factors.

These researchers have developed discussions on the significance of cultural contexts in a country’s economic growth. After discussion, they are now acknowledged about the limitations of focusing on economic variables. However, they have yet to delve into the specific cultural context of a country and the underlying story behind it. Another drawback or disadvantage of these existing sets of literature is that they are mostly elaborated on from the Western, developed-country perspective. The applicability and ubiquity of a theory may or may not transcend national borders, thus making certain social and economic theories inapplicable in developing countries.

This book will add to the variety of possible explanation of Korea’s accomplishments by introducing psychological aspects of Korean people as a major contributor. Later parts of this and other chapters will discuss psychological backgrounds of Korean culture quite extensively, and the second half of this book will develop on these ideas by putting greater emphases on internal dynamics of the Korean government.

Leadership matters

While it is now clearer that culture in addition to economic factors is significantly associated with economic growth, the leadership of a country may emerge as another controlling factor in the relationship. Decisions to invest more capital and resources into certain industries or emphasizing the importance of higher education on engineering mostly originated from the leader’s vision and mission. The classic example of such leadership is that of President Park Chung-hee in the 1960s and 1970s. The Park Chung-hee regime in Korea succeeded in creating a competitive atmosphere through charismatic leadership and a centralized bureaucracy. It stems from Park Chung-hee’s vision of utilitarian and nationalistic philosophy, and his great mission centered on economic growth, both of which had not been defined in previous regimes’ governing philosophy. Park’s vision and mission resulted in a major turning point in Korean society (Im, 2008).

Once Park Chung-hee’s desire for power had been realized through a coup d’état on May 16, 1961, his vision and mission for a stronger national economy began to be executed through numerous projects. Born in a poor family, Park emphasized that people should no longer suffer from hunger and poverty. He was determined to devise ways to achieve economic growth as it seemed to be the only way to nourish everyone in the postwar adversity. While a vast number of pieces of literature point out that the national goal of economic development was the primary means of justifying the coup (Kim, 1993: 147–148; Kim, 2013: 77), growth was pivotal in distributing national income to the people. The national income at that time was just inadequate for everyone to share. Park further stressed the logic that “the ideal democracy is hardly achieved without a stable economy” during his New Year speech in 1962. Park Chung-hee thus prioritized a state-led planned economy over anything else.

However, there were not enough capital or natural resources within the country to establish sustainable and lucrative industries. Park Chung-hee’s strategic choices accelerated the economic growth in the 1970s. Importing natural resources was unavoidable to initialize manufacturing industries and power plants, but Park pointed out that efficiency should be the core philosophy in mobilizing resources. As a strategic and rational actor, Park initially adopted the import substitution industrialization strategy. Instead of importing construction materials such as cement or fertilizers for the agricultural industry, he ordered domestic production of these products. When the international political economy changed, he switched to an export-led growth strategy that eventually resulted in the Miracle on the Han River (Tadashi, 2008). The strategy required export-led businesses to almost dominate most intermediate and primary resources. With most resources concentrated on these strategic businesses, Korean industries later gained comparative advantage on steel, shipbuilding, and electronics (semiconductors).

Aside from the strategic use of physical resources, Park Chung-hee also pursued efficiency and professionalism in bureaucracy. He emphasized that efficiency in bureaucracy would support his strategic choices; he also replaced corrupt and incompetent officials in numerous government positions with competent personnel from the military (Im, 2008: 224). Whenever military personnel showed their limited administrative capacity, Park implemented a career bureaucracy based on performance rather than a spoils system. He also demanded professionalism in bureaucrats by introducing the civil service system that comes in a package with privileged pension and health care service back in the 1960s. These measures helped to motivate bureaucrats by delegating policy making power to technocrats, which resulted in their full contribution to the economy takeoff.

With a powerful leadership marked by efficiency and professionalism, the Park regime gained its status as the main contributor in Korea’s rapid economic growth, despite long controversies on its legitimacy. The president’s leadership strengthened bureaucrats’ policy implementation power in addition to utilizing local resources, as can be seen in the Saemaul Movement (the ‘new town’ movement) in the 1960s and 1970s. The coherent decision-implementation process may pertain to dictatorship, as many people have criticized. However, despite severe criticisms on decades of forceful execution of power onto the people and negative side effects, the strong leadership unchecked by opposing powers resulted in a bureaucratic coherence (Chibber, 2002).

As stated earlier, leadership was an important factor, leading to a stunning development in Korea. However, there still remain many questions that leadership studies are not able to answer. For example, it is rarely elaborated how and why national plans initiated by the Park regime survived under different leadership. Because those plans were not highly systemized or institutionalized, they would not have been hard to change. Also, national leaders were likely to abandon the predecessor’s plan because they needed to legitimize their presence. Another example of an unanswered question is how national plans and systems formed in the development era have influenced politics and social culture in Korea. In order to deal with these unexplored answers, we need to concentrate on a fundamental mechanism.

Governance from psychocultural perspectives

Governance and competitiveness

Most studies have investigated the governance mechanism based on the power approach: who governs and how they govern. However, only a few studies have explored the governance system with respect to social-cultural aspects. Specifically, studies did not pay attention to the socio-cultural and psychological characteristics of the ruling elite or to those of the people. While Korea’s economic growth in the 1960s–1980s, as most other researchers claim, does pertain to the public administration’s leadership and its cooperation with the people, the underlying psychology between officials and citizens has not been clearly identified. In this regard, there needs to be a novel approach that can shed new light on the miracles in Korea. This book will dedicate most of its pages to discussions on two psychological factors that have contributed to the growth: competitiveness and collectivism.

Competitiveness and collectivism seem to be contradictory concepts that cannot coexist. However, they have been essential values prevalent in Korean organizations, public or private. These two values have helped organization members to compete within and with other organizations. The initial onset of competitiveness of a person happens when he or she wants to be a better person. On the other hand, this person may compare how much he or she has achieved with where others stand. The first case is personal development competitiveness (PDC), and the latter is hyper-competitiveness (HC). These two values together result in competition among people.

The competitiveness of an organization’s member may lead to numerous competitions within an organization, and these competitions can fu...

Table of contents

• Cover
• Half Title
• Series Page
• Title Page
• Copyright Page
• Table of Contents
• List of figures
• List of tables
• 1 Competition: a novel concept?
• 2 Competition traits as psychological drivers
• 3 Competition within an organization
• 4 Competing with an organization
• 5 Governance from the competition perspective
• 6 Competition and governance in the future
• Index