dern infrastructure that provided Park with a solid foundation for economic growth. The Park administration decided that the central government must play the key role in economic development because no other South Korean institution had the capacity or resources to direct such drastic change in a short time. The resulting economic system incorporated elements of both state capitalism and free enterprise. The economy was dominated by a group of chaebol, large private conglomerates, and also was supported by a significant number of public corporations in such areas as iron and steel, utilities, communications, chemicals, and other heavy industries. The government guided private industry through a series of export and production targets utilizing the control of credit, informal means of pressure and persuasion, and traditional monetary and fiscal policies. The government hoped to take advantage of existing technology to become competitive in areas where other advanced industrial nations had already achieved success. Seoul presumed that the well-educated and highly motivated work force would produce lowcost, high-quality goods that would find ready markets in the United States and the rest of the industrial world. Profits generated from the sale of exports would be used to further expand capital, provide new jobs, and eventually pay off loans.Economic Plans Economic programs were based on a series of five-year plans that began in 1962.The first five year Economic Development Plan (1962-66) consisted of initial steps toward the building of a self-sufficient industrial structure that was neither consumption oriented nor overdependent on oil. Such areas as electrification, oil refining, synthetic fibers, and cement were emphasized. The Second five-year Economic Development Plan (1967-71) stressed modernizing the industrial structure and rapidly building import-substitution industries, including steel, machinery, and chemical in...
