Land, from Driver of Growth to Source of Inequality = Land, from Driver of Growth to Source of Inequality

다국어 초록 (Multilingual Abstract)

It was the natural qualities of land that were most important in agricultural societies, but with urbanization, location became more significant. As populations concentrated in cities, rural areas became increasingly marginalized, and this exacerbated differences in land values. The capital gains that were associated with real estate investment came to be linked with the dream of homeownership, thus raising the savings rate and further increasing land price inflation. High growth supported and perpetuated such trends. The Gini Coefficient deteriorated in the first half of the 1970s, before improving from the late 1970s until the early 1990s. The 1997 Asian Financial Crisis presaged a renewed worsening of the situation. The land reform of the 1950s led to a highly equal distribution of land that persisted into the first half of the 1960s. From the late 1960s until the late 1980s, land distribution became increasingly more unequal. The inequality then improved in the first half of the 1990s, before again reversing following the financial crisis. In the late 1980s, the South Korean economy had entered a virtuous circle of rapid growth and narrowing inequality, but with the Asian Financial Crisis, this trend reversed, thus leading to the new norms of low growth and rising inequality, and with them, growing polarization. The causes of this contemporary polarization are structural, and include population aging, the hollowing out of the manufacturing industry, and the decline of agriculture, but policy interventions are required to ensure that such trends do not continue to a point where the sustainability of the social system is threatened.