Inequality, Corruption, and Trust in South Korea, in Comparative Perspective

Jong-sung You (유종성)

The book explores how inequality affects corruption and how inequality and corruption influence trust, including social trust (generalized interpersonal trust) and institutional trust. After reviewing the relevant literature (Rothstein 2011; Uslaner 2008), including the author’s earlier works (You 2012; 2015; 2016; 2017; 2018), it presents a theoretical framework incorporating both macro- and micro-level factors based on a behavioral approach to the rational choice theories of principal-agent and collective action (Ostrom 1998). It proposes that high inequality undermines democratic accountability mechanisms and increases corruption by fueling political clientelism and policy capture by the elite. It also maintains that inequality and corruption increase people’s perceptions of unfairness, thereby eroding both interpersonal and institutional trust. It also suggests that low levels of social and institutional trust make it difficult to reduce inequality and to curb corruption, both of which require high levels of collective action capacity of the citizenry, particularly in democracies. Thus, there can be both virtuous cycles of equality, integrity, and trust and vicious cycles of inequality, corruption, and distrust.

The book tests these hypotheses through a comparative historical analysis of Korea, Taiwan and Japan. It explores how increasing inequality in these East Asian democracies that traditionally enjoyed the reputation of “growth with equity” (World Bank 1993) influenced political processes and people’s perceptions on fairness. It attempts to uncover the similarities and differences, paying special attention to the interactions between electoral and political institutions on the one hand and economic concentration and inequality on the other hand. In particular, it will examine how Korea’s chaebol-dominating economy with dual labor markets have shown similar and different patterns of clientelism and elite capture, compared with Taiwan and Japan.

It also conducts statistical analysis of survey data on individuals’ interpersonal and institutional trust and perceptions of inequality and corruption, such as the World Values Survey, Asian Barometer Survey, and the Korean General Social Survey, as well as an experimental survey, to examine the effects of perceived inequality, corruption, and fairness on both interpersonal and institutional trust. It will explore the commonalities and differences in the relationships between these variables across three countries.

ToC: 1. Introduction; 2. Review of Literature and Theory: Inequality, Corruption, and Trust; 3. Corruption in Korea; 4. Inequality and Clientelism in Korea, in comparison with Japan and Taiwan; 5. Inequality and Capture in Korea, in comparison with Japan and Taiwan; 6. Interpersonal and Institutional Trust in Korea; 7. Perceptions of Inequality and Corruption and Levels of Trust in Korea, in comparison with Asian countries; 8. Conclusion