Where do you see South Korea in 10 years? South Korea’s economy began to change in the early 1990s after the country’s military took power. Instead of relying on imports, the chaebols began to focus on building sophisticated hardware in the knowledge-intensive industries, such as semiconductors, mobile phones, and steel. Since then, government-backed collaborative ties with leading companies have made the country a technological powerhouse.
The government’s funding for R&D and innovation pushed for translational development and scientific expertise. In the 2000s, however, the emphasis on government funding began to decline, and the country’s R&D spending shifted more to the private sector in the pursuit of profits and patents. By 2019, private sector R&D accounted for nearly 80% of the country’s total R&D budget. In comparison, only a small percentage of South Korea’s total R&D budget came from government funding. In addition to government funds, R&D spending was largely supported by foreign technology and R&D tax incentives.
The Korean economy benefited from economic development, which helped build a middle class. The middle class made up 21% of the population in 1960 and rose to 46% by 1990. In the early 1950s, political participation was stifled due to the military dictatorship, which lasted 26 years. After the Korean War, the democratization process was launched, and a student protest against the dictatorship was the primary catalyst for the country’s democratic transition. The growth of the middle class was the most important prerequisite for achieving democracy.