Mass attitudes toward financial crisis and economic reform in Korea
Philipps-University Marburg and ZEI, University of Bonn, Germany
Correspondence: Bernd Hayo, Faculty of Business and Economics (FB 02), Philipps-University Marburg, Universitaetsstrasse 24, 35037 Marburg, Germany. E-mail: hayo{at}wiwi.uni-marburg.de
This paper gives an account of the financial crisis that took place in Korea from the point of view of the Korean population, using survey data collected in 1998 and 1999. Although both, internal and external factors were blamed as causes, domestic factors were considered to be of greater importance. After identifying respondents as supporting either market-based or state-based reform strategies using factor analysis, various determinants of these alternative views are being analysed within the framework of regression models. A particularly interesting result is that, contrary to theoretical assumptions and empirical evidence on other regions, it is political ideology and not individual economic determinants that helps to explain the respondents' attitudes towards reform strategies in Korea.
Key Words: South Korea • financial crisis • public opinion • economic reform strategies • JEL classification: O5, F3
1 The study is based on representative samples of the adult population in Korea (20 years and over) collected by a combination of stratified and random sampling. The fieldwork was done by Gallup Korea using face-to-face interviews after a pre-test phase. About 1000 successful interviews were finally conducted. The Korea Barometer 1998 was sampled in October 1998 and the Korea Barometer 1999 in November 1999. See Shin and Rose (1998, 1999) for a more detailed description of the database.
2 The results of the factor analysis for the five variables are [communalities, loadings factor 1 (eigenvalue 1.86), loadings factor 2 (eigenvalue 1.05)]: lay off unnecessary workers in the private sector (0.56, 0.60, 0.44); lay off unnecessary workers in the public sector (0.65, 0.78, 0.20); privatize state corporations (0.53, 0.71, –0.18); make the government smaller by reducing its budget (0.47, 0.61, –0.18); and more government control over chaebols, banks and state enterprises (0.70, 0.005, 0.83).
3 Note that in the transition countries of Eastern Europe economic and political reforms are very much intertwined (Duch, 1993; Hayo, 2001).
4 The outcome of the reduction test is 
2(31) = 36.7.
5 Kim Dae Jung later founded the Millenium Democratic Party (Minjoo Dang) in 2000.
6 The Pearson correlation coefficient between news interest and an education level of high school and more is 0.10.
7 The outcome of the reduction test is 2(33) = 37.9.
8 The correlation coefficients are 0.10 and 0.09, respectively.
9 Using a t-test for two independent samples, we cannot reject the hypothesis that the two coefficients of the influence of being prepared to personally take on part of the burden of reform are equal at any reasonable level of significance (t-test value 0.44).
10 The outcome of the reduction test is 2(31) = 35.1.