Case against capital-account liberalization - Interpreting continued crisis in Korea in terms of speculative foreign capital

The financial crisis of 1997 has led Korea into a deeper, continuing crisis. Korea accommodated the market-based prescriptions as literally as possible, but expected benefits of Washington Consensus have not materialized. This paper aims to explain this dismal result in terms of speculative nature of foreign capital. it turns out that foreign equity capital, once legitimized by the shareholder value maximization principle, triggers off damaging effects over the economy. Korea may need to find a solution by reaching a social consensus.