Most economists would say that the most crucial factors in economic growth are workforce, the quantity and quality of it, and capital. Often ignored is the subtle but crucially important role of culture, the way people in a society behave towards other members of the society.
A case in point is the economic gap between the U.S. and Brazil: While both countries are endowed with abundant natural resources and filled with non-aboriginal people, Brazil has been unable to match the U.S. for all these years. There are undoubtedly many reasons for it, yet those may all boil down to just one: the cultural difference.
South Korea’s economy has grown at an exceptional pace in the past few decades, delivering millions of Koreans from grinding poverty that had gripped their forefathers for generations. How can Korea ensure its future prosperity? Yes, Korea has to keep upgrading the quality of its workforce. Yes, Korea has to make itself a friendlier business environment. But, Korea also has to fundamentally shift its contemporary mass-culture to make its public behavior more civil.
In many advanced societies, anti-social behavior by free-loaders, behavior that harms those who contribute to the society by those who do not, are rare. In a less developed society, free-loaders routinely fend off everyone as a competitor. The mass-culture of Korea today resembles that of a less developed country, despite Korean traditional culture’s intolerance of anti-social behavior. For Korea ― whose citizens are now mostly anonymous city-dwellers ― to truly become an advanced country, Korea needs to expand the reaches of its traditional cultural norms to strangers in public places going beyond small circles of clans.
Tossing out cigarette butts from speeding cars, spitting in the street, being drunk in public and pushing people out of the way on sidewalks are some examples of the anti-social behavior that is common in Seoul. Such behavior is not merely uncivilized; it is harmful to the economic productivity of society, not to mention its quality of life. For example, a single accident caused by one self-interested traffic rule breaker can cause a long delay for thousands on highways. The economic damage of this single anti-social behavior ― the wasted time, gasoline, and the lost production of the thousands affected by the accident ― can be substantial.
The economy-wide annual cost of all anti-social behavior in Korea, the sum of all of the time and money wasted in all walks of life throughout the economy for a one-year period attributable to anti-social behavior, can be enormous. It could perhaps easily be more than 10 percent of Korea’s annual GDP. In other words, by simply curtailing anti-social behavior by one half, the Korean economy would grow 5 percent a year, a rate greater than the current economic growth rate of 3-4 percent per annum.
In places where the societal culture (i.e. its norms and rules) does not protect those who contribute to the common good of the members, those who seek self-interest at the expense of other members’ inevitably dominate. To prevent Korean society from succumbing to anti-social behavior, Korea’s school systems must better educate the young of the country’s traditional culture which values and respects those who contribute to society and despises anti-social behavior.
The government should also adopt strict rules against anti-social behavior and enforce the rules with stiff fines. The economic prosperity of Korea, and the quality of life of all Koreans, depends on it. If you are not convinced of it, just look at Singapore. It has transformed itself from a smugglers’ cove into one of the most prosperous places on Earth by, among others, elevating the public civility of its citizens.
By Kenneth S. Choie
Kenneth S. Choie is a professor of finance at Sejong University. Formerly, he was a portfolio manager at UBS in New York. He earned his Ph.D. in economics and finance from the University of Michigan. He can be reached at kchoie@aol.com. ― Ed.