Regionalism and redistribution in South Korea

Abstract

In South Korea, it has been widely known that an incumbent president allocates a disproportionally larger amount of intergovernmental transfers to regions with more loyal supporters. It has been also believed that despite a government change in 1997, this positive and linear relationship between support for an incumbent president and allocated public funds did not change. We show that neither is valid. Based on a formal model, we argue that an incumbent president allocates a larger amount not only in his own turf but also in his rival's and a smaller amount in regions where votes are divided more evenly between candidates. This quadratic relationship between vote and money is highly significant under the Kim Young Sam administration (1993--1997) but not significant during the Kim Dae Jung administration (1998--2002).