Abstract

The purpose of this paper is to analyze economic behavioral patterns of Koreans, and to grope for a new methodology for Korean Economics. This paper, in particular is an the empirical analysis on whether Koreans would make economic decisions that vary from the behavioral assumptions of neoclassical economics. The followings are new findings: Firstly, we can summarize that neoclassical economics, which is known as the mainstream of economics, is constructed on the basis of two behavioral assumptions: one is the pursuit of self-interest as the behavioral motivation of human beings, and the other is rationality as a cognitive ability. Secondly, man as he is usually shows opportunism, i.e., self-interest seeking with guile and bounded rationality, or, being intentionally rational, but only limitedly so. This type of human nature is called contracting man which is the basis for the newly emerging New Institutional Economics. Thirdly, it has been found that in decision making, Koreans consider family as the basic unit of decision making, show complexity in communication, abstraction in the understanding of th rule of law, and depend on emotions for problem-solving. These economic characteristics of Koreans are close to those of contracting man rather than “economic man.” Finally, this paper suggests that new institutional and/or evolutionary economics, which considers Korean culture and history, explains consumption behavior, corporate activities, and economic policies in the Korean economy better than neoclassical economics.