Korea's Dominant Capital -- Hyeng Joon Park
Channel: Creorder
Date: 2013-01-08

3rd Annual Forum on Capital as Power: "Capitalizing Power: The Qualities and Quantities of Accumulation"

September 28-30, 2012, York University, Toronto

15. The Transnationalization of Korea's Dominant Capital and Its Differential Accumulation in the Post-1997 Period: Beyond the Dichotomy Between Productive Industrial Capital and Unproductive Financial Capital

Hyeng-Joon Park, Global Political Economy Institute, Seoul (hyengjpark@gmail.com)

After the 1997 financial crisis, the neo-liberal restructuring of the Korean political economy accelerated dramatically. While there is a general consensus that Korean society, which has undergone a tremendous transformation, is not the same as before, heated debates on the nature of the change are still ongoing. The purpose of this paper is to cast a new light on the post-1997 restructuring of Korean society from the perspective of Capital as Power, an approach developed by Nitzan and Bichler (2009; 2002).

Development economists have led the controversies over the nature of neo-liberal globalization in Korea. Defining the nature of the problem as the subordination of 'productive' domestic industrial capital to 'unproductive' foreign financial capital, they argue that we need to empower the Korean chaebols (conglomerates) so that they can engage in rapid industrial development. In my view, they confuse the differences between both business and industry in the Veblenian sense and industrial and financial capital.

This paper offers an alternative understanding of Korea's neo-liberal reform from the perspective of Capital as Power. It argues, first, that the kernel of the post-1997 restructuring is the establishment of capitalization as the creorder of Korean society. Second, it argues that the nature of globalization is the incorporation of Korea's dominant capital into the global structure of absentee owners through the transnationalization of ownership and accumulation. Lastly, it argues that the reduction of green-field investment, relative to the pre-1997 period, is to be explained by the shift of the regime of differential accumulation rather than the subordination of 'productive' industrial capital to 'unproductive' financial capital. 

Conference page: http://bnarchives.yorku.ca/341/