We have, so far, examined global economic indicators of economic transformation of South Korea. And also, we have looked into the determinants of economic success in South Korea, by paying attention to such factors as history, international factor, and market factor, state factor, and network factor. And at the same time, we have a look into the downside, what dark side of economy grows in South Korea. First, second, third economic crisis. Then, having determined all these counter factors, what kinds of implications can we know from this experience? I would argue that there are fundamental limitations to the development state and while other developing countries have been trying to emulate the South Korean model of development state. But I would counter-argue that there is a real problem in applying South Korea development state concept to other systems. I would say that it is rather peculiar and specific to South Korea rather than it can be so-called transferable or universalizable. Why? First of all look at the current status of state. Now did not understate the ideology framed around the rich nations, strong army. Or mentality is no longer valid, okay? Some political leaders argue in that way. China has been arguing this rich national strong army. But in the case of South Korea, that ideology's less appealing to the people. Another important change is what? South Korean state is no longer a unitary actor. We have a strong bureaucratic in-fightings, and also we have the pressures coming from civil society and the political society, particularly executive dominance is no longer varied, okay? That's straight-to-gridlock has become much more common than before. And precious from the civil society, particularly mis-media have been quite influential. If we cannot recreate all type of developmental state in South Korea. And the political ties between objective and bureaucratic system are still working, but in very limited sense, okay? Particularly we have in South Korea no have one term, five year presidency. And when the president come to get into forth year on then we see, we may witness lame the period. bureaucrats are not bureaucrats with out distance for president and a platform there. Market has become too big, too large to be controlled and orchestrated by the state. It is really misleading that political leaders argue that the government policy intervention they can change market. No, that's wrong, wrong even presumptuous in the proposition. Now market has to be controlled, contained, orchestrated and coordinated by the state. If a government should realize the inherent limit in dealing with the market system, okay? And then doesn't mean the demise of the market state. Our sons. We still have a institutional inertia with the open state, but we do not have all type of developmental state. That is an important lesson which to learn. And also, that implies what developmental state is not fixed concept. It is transitional concept. When South Korean economy becomes much more mature then there is. Decreasing room for developmental state. That is the lesson we should learn. And now, finally, as part of conclusion, what implication we can have. What are the new challenges? This is really separate topic, but since this class, we're dealing with the political economy of South Korea, and let us touch on some important challenges which South Korea is facing. Most important challenge is what South Korea is being sandwiched between China and Japan. China has corrupt Labor intensive product. Even they are moving into, in a cutting edge technology. But Japan was, has been always ahead of South Korea, in technology intensive sector. Therefore, South Korea has real difficulty in coming up with a new strategic location between the two giant economies. Another dilemma which South Korea is facing is low fertility and aging society. In South Korea, our fertility rate, population growth rate is less than 1.5%. We are lower than Japan. Yet we have a growing, aging population in South Korea. But that means what? We do not have a young, vital in the population. We have a diminishing young population, okay? Why we have a less productive aging population getting larger and larger, and how South Korea can survive, okay? In that demographic setting. There is the second most important dilemma we are faced. Third dilemma with we are faced is a dilemma of polarization. Polarization of income, wealth, even more than that, okay? Now firms, big firms and small firms. Export sector firms and inward looking firms, okay? Technologically intensive firms and technologically less intensive firms. And when corporations are polarized, okay? Even education. Rich guys get the better education and poor guys get the less efficient public education. Because each educational polarization had become a picture. Of course, polarization is nothing unique to South Korea all the countries, particularly the military economies, such as the United States, United Kingdom, they have been facing this dilemma of polarization. You can understand the rise of Donald Trump and Bernie Sanders, or Brexit in Great Britain. They're all a reflection the dilemma of a polarization, maturing in those societies. But still, how to overcome the polarization would become the major issue for the political leaders in South Korea. Other big issues, what? Regardless of conservative progress, all the South Korean government had been trying to come with Chaebol reform. Reform of big business conglomerates. But they have not been successful. They have a fundamental limitation to state power. Therefore how to continue general reforms. And come up with some kind of economy democracy in a better form. It means nothing but some test for South Korea. Also another big issue, there is a protected conflict of labour reform, okay? Conservative one or two. The limit the power in influence of labor but progressing want assure more power and more benefit to labor. There ahs been ongoing conflict between the two segments in society. But we have not reached any consensus on that issue, wages, so-called minimum wages, okay? Over the issue of the laying off workers from the work site. All decision has become the big issues, including social welfare. And so a social safety net for those who are losing their jobs. And perhaps finally the most important issue in sudden decline of engines of growth. For example ship building. South Korea used to be number one in ship building. Now ship building industry in South Korea is undergoing major trauma. Shipping industry, same. We might have several other major industry sectors which used to be most competitive on the world stage and now facing major challenges. How to deal with these kinds of sunset industries and how to come up with a new engine of growth, new sunrise industries. Okay, in other words how to come up with new niches for our survival and growth in the future will be the major issue. Likewise, Korean economy has a long way to go. But we got to remember one thing. South Korea has made unprecedented economy transformation in the past 60 years, okay? That's important one. We had compressed the economy cost to that extent, to the extent that it is compressed. We're now exposed to all kinds of contradictions. Okay, however, it is quite amazing South Korea to achieve that kinds of economic performance. We should keep that in mind.
