Publication Details
Abstract
Why do some nations escape the poverty trap while others, starting from nearly identical economic conditions, stagnate for decades? This article investigates this central puzzle in development economics through a comparative case study of South Korea and Pakistan. In 1960, both nations shared a similar GDP, low income per capita, and recent histories of national trauma. By 2024, South Korea had become a global technology leader with a GDP per capita exceeding $36,000, while Pakistan remained a low-income country with persistent instability and a GDP per capita of roughly $1,500. This research argues that the “secret” of the Korean model lies not in a single factor but in a synergistic combination of inclusive economic institutions, a developmental state, strategic state-chaebol partnerships, and an obsessive focus on human capital. In contrast, Pakistan’s divergence is explained by elite capture, political instability, import-substitution policies, and chronic underinvestment in education. The article concludes that political choices and institutional design—not culture or geography—are the primary determinants of long-term economic fate.