External Debt and Macroeconomic Performance in South Korea

32 Pages Posted: 23 Apr 2004 Last revised: 8 Aug 2010

See all articles by Susan M. Collins

Susan M. Collins

Brookings Institution - Economic Studies Program; Georgetown University - Department of Economics; National Bureau of Economic Research (NBER)

Won-Am Park

Hong-Ik University; National Bureau of Economic Research (NBER)

Date Written: May 1988

Abstract

During 1980-1986, South Korea went from being the world's fourth largest debtor country, in the midst of an economic crisis, to a model of successful adjustment, with high growth rates and a current account surplus. This paper summarizes the findings of an in depth analysis of Korea's performance, focusing on the experience with external debt. We argue that the explanations for Korea's recovery are closely linked to the explanations for Korea's very rapid growth during the 1960s and 1970s. The centerpieces have been a comprehensive export focused investment plan with external borrowing wed to supplement domestic savings in financing the investment and an active, interventionist government policy.

Suggested Citation

Collins, Susan Margaret1 and Park, Won-Am, External Debt and Macroeconomic Performance in South Korea (May 1988). NBER Working Paper No. w2596. Available at SSRN: https://ssrn.com/abstract=227520

Susan Margaret1 Collins (Contact Author)

Brookings Institution - Economic Studies Program ( email )

1775 Massachusetts Ave. NW
Washington, DC 20036-2188
United States

Georgetown University - Department of Economics ( email )

Washington, DC 20057
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Won-Am Park

Hong-Ik University

72-1 Sangsu-dong
Mapo-gu
Seoul 121-791
Korea

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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