Whither South Korea’s economic growth? Growth deceleration, structural issue, and risk of stagnation

Korea has been struggling with its faltering growth over recent years. Sorting out the key elements that have gone into this slowdown and what it takes to sustain growth into the future is important. We address the nature of growth deceleration, structural factors, and future growth scenarios and present the evidence that structural rigidities and poor-quality institutions are important factors behind Korea’s very low productivity and hold a key to reviving growth. Reforms can put Korea back on a higher growth path. However, in the absence of reforms or global growth recovery, there is a great risk of long-term stagnation.