ABSTRACT
The South Korean! economy came to be widely regarded as a possible 'role model' to be followed by other newly industrializing economies (NIEs). The 1997 'Asian Crisis' shattered this image (although economic growth has since strongly returned). A report has argued the Korean economy is in a competitive 'squeeze' between lower-cost and rapidly growing economies, such as China, and higher knowledge/technology-based economies, such as Japan, on the other (Booz-Allen and Hamilton, 1997). This situation is, they argue, a result of structural economic problems, such as high cost but rigid systems, inflexible labour markets and widespread bureaucratic intervention. It is believed that once Korea builds up a new economic paradigm, one based on market-led, global and transparent systems, it would have the potential to combine the best of both worlds.
