Taxes, Outward Orientation, and Growth Performance in Korea

46 Pages Posted: 5 Oct 2009 Last revised: 25 Sep 2022

See all articles by Irene Trela

Irene Trela

University of Western Ontario - Department of Economics

John Whalley

University of Western Ontario - Department of Economics; National Bureau of Economic Research (NBER); CESifo (Center for Economic Studies and Ifo Institute); Centre for International Governance and Innovation (CIGI)

Date Written: June 1990

Abstract

This paper both discusses and evaluates the role of tax policy in the Korean growth process from the early 1960s to the late 1980s. It begins by reviewing the evolution of Korean policy over this developmental sequence, emphasizing three distinct regime switches, and the tax policies which were part of them. It then presents an analytical framework for quantitative assessment of the contribution of tax policies to this growth through induced intersectoral resource transfers and impacts on effort and labour supply in agriculture and manufacturing sectors. What emerges from the model calculations is that tax policy has played a relatively modest role in Korean growth and that one should look outside of tax policy for the main factors underlying strong Korean growth.

Suggested Citation

Trela, Irene and Whalley, John, Taxes, Outward Orientation, and Growth Performance in Korea (June 1990). NBER Working Paper No. w3377, Available at SSRN: https://ssrn.com/abstract=1482886

Irene Trela (Contact Author)

University of Western Ontario - Department of Economics ( email )

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John Whalley

University of Western Ontario - Department of Economics ( email )

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