ABSTRACT
South Korea has a central place in neo-classical thinking about development in general, because it provides or appears to provide the living example that the broad neo-classical prescription for development is empirically well grounded. The import-substituting industrialisation strategies put forward in the 1950s were a response to the observed difficulties of earning adequate foreign exchange through agricultural exports and to the absence of industrial sectors capable of withstanding international competition in export markets. The neo-classicals argued from the late 1960s that South Korea was proving that their prescription worked - not only could it produce fast growth, but equitable growth as well. South Korea was unusually well placed to take advantage of emerging opportunities for cheap labour manufactured exports. The restrictive policy towards foreign direct investment has meant that vis-a-vis multi-national capital the South Korean state has had a notable degree of autonomy of action.
