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Unpublished Paper
Financial Regulatory Reformation in South Korea and Experience of the Consolidated Regulatory System
ExpressO (2010)
  • Jeongdoo Lee, Indiana University - Bloomington
Abstract
One significant recommendation for the U.S. financial reformation is the consolidation of regulatory system, which South Korea adopted after the Asian financial crisis. This paper briefly reflects the causes of the Korean financial crisis from the points of financial regulation, and explains the process of reformation and experiences of Korean consolidated system including some modifications after the initial reformation. In addition, this paper evaluates the Korean regulatory system with general standards and needs for changes in the backgrounds of various economic and political surroundings. Although there can be general requisites for desirable regulatory system, the reason for the change itself is also important yardstick to evaluate a system because the result of the reformation must satisfy its primary factors. This paper evaluates the Korean financial regulatory reformation with the standards of clear and pertinent objectives, independence, accountability and check for the authority, and efficiency and expertise. Independence of financial regulation and separation of economy policy and financial policy authorities are additional standards for evaluation because they are related to the causes of the financial crisis and have been pointed out as critical matter in Korean system. In conclusion, Korean financial regulatory system, in some aspects, looks like past regulatory system which was targeted for reformation. The basic principle of change was to correct past mistakes and cope with unexpected change of situation. From this point of view, the current system shows some deficits and needs to construct more effective and independent regulatory system which can satisfy the original needs for regulatory reformation.
Keywords
  • Financial Reform,
  • Consolidated System,
  • Subprime financial Crisis,
  • Asian Financial Crisis,
  • South Korea
Disciplines
Publication Date
January 22, 2010
Citation Information
Jeongdoo Lee. "Financial Regulatory Reformation in South Korea and Experience of the Consolidated Regulatory System" ExpressO (2010)
Available at: http://works.bepress.com/jeongdoo_lee/1/