For the last 60 years, the Korean economy has achieved an astounding development that is called “the Miracle of the Han River.” Korea was one of the world’s poorest countries at the time of the national liberation in 1945 and it went through a three-year long Korean War from 1950. However, it grew into one of the world’s leading trading powers. Its per capita income, which was merely 255 USD in 1970, reached 22,000 USD as of 2012. One of the most important factors that enabled the Korean economy to achieve such a great development was the consistent expansion of its social overhead capital and its wellplanned national development projects.
There was no expropriation and compensation system before the 1960s. Although the principle of expropriation and compensation and security of property rights were specified in the Constitution in 1948, the land expropriation during the time was in accord with the
Land Expropriation Decree established during the Japanese colonial period.
Art. 23-3 of the Korean Constitution stipulates that “Expropriation, use, or limitation of private property due to public necessity and with regard to compensation shall be governed by an Act so that just compensation shall be paid.” Hence, expropriation, which means compulsory deprivation of private property rights by the governmental authority for public needs, is based on the assumption that there is a necessity for the public good when private property is to be compulsorily acquired regardless of a person’s will as stipulated in Art. 23-3 of the Constitution. As for just compensation designated by the Constitution for individual
infringements of private property rights that require compensation in the enforcement of law and order, the compensation, in principle, means full compensation that the objective value of expropriated properties should be completely indemnified.
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The Korea Development Institute is an autonomous policy-oriented research organization founded in 1971. KDI was established by the Korean government as an economic think tank to provide a rigorous academic perspective on the various economic policy issues that had arisen during Korea’s rapid growth and development in the 1960s. Since then, the scope of KDI’s activities has grown, and it is now called upon to provide expert analysis and advice on all aspects of long- and short-term government policies in areas ranging from domestic economic policy to international trade and investment.
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