San José State University
Department of Economics
Thayer Watkins
Silicon Valley
& Tornado Alley


The chaebol are the large, conglomerate family-controlled firms of South Korea characterized by strong ties with government agencies. The name, which means business association, is properly pronounced jay BOL but the spelling pronunciation chay bol is considered acceptable by Korean speakers. There were family-owned enterprises in Korea in the period before 1961 but the particular state-corporate alliance came into being with the regime of Park Chung Hee (1961-1979). Park modeled this arrangement on the zaibatsu system which developed in Japan during the Meiji Era. There were significant differences between the zaibatsu and the chaebol, the most significant of which was the source of capital. The zaibatsu were organized around a bank for their source of capital. The chaebol in contrast were prohibited from owning a bank. The Park regime nationalized the banks of South Korea and could channel scarce capital to industries and firms it saw as necessary for achieving national objectives. The government-favored chaebol had special privileges and grew large. This gave the impression of economic success for the chaebol that was not always valid. In some cases chaebol grew not because they were profitable but merely because they could borrow vast funds. When the international economy took a downturn these debt-ridden businesses were in trouble. In 1999 one quarter of the manufacturers in South Korea did not earn enough to meet the payments required for their debt.

In recent years there has been the growth of mid-sized corporations which are outside of the chaebol arrangement. For example, Appeal Telecom was started by a former employee of Samsung, Lee Ga Hyoung. Appeal Telecom is manufacturing and marketing cell phones and has risen to the top in its field. In Germany the mid-sized corporation make a great contribution to the economy and there is no reason that such firms could not be an important element of the South Korean economy.

Given below are the histories of some of the major chaebol. The record of the membership in the top ten gives a snapshot of the business history of the South Korea chaebol.

The Top Ten Chaebol Over the Years
Mid-1960's19741983 199019952000
1SamsungSamsungSamsungHyundaiHyundaiHyundai Hyundai
2SamhoSamhoLGSamsungDaewooSamsung Samsung
3GaepungLGHyundaiDaewooSamsungDaewoo LG
5LGGaepungSsangyongSsangyongSsangyongSK Hanjin
6TongyangSamyangSKSKHanjinSsangyong Lotte
7KeukdongSsangyongHanhwaHanhwaSKHanjin Daewoo
HwashinDaenongHanjinHanhwa KiaKumho
KukjeDaelim HanhwaHanhwa
DaelimLotte LotteSsangyong
Source: Stephan Haggard, et al., (eds.), Economic Crisis and Corporate Restructuring in Korea: Reforming the Chaebol p. 41.

The Early History of Some of the Major Chaebol

Lucky Goldstar

The special case of the Kukje chaebol.

The Recent History of Some of the Major Chaebol


For a list of the top 45 chaebol in 1997 see here.


The 45 Top Chaebol
of South Korea, 1997
Rank Chaebol
3 LG
4 Daewoo*
5 SK
6 Ssangyong
7 Hanjin
8 Kia
9 Hanwha
10 Lotte
11 Kumho
12 Halla*
13 Dong Ah
14 Doo San
15 Daelim
16 Hansol
17 Hyosung
18 Dong Kuk Steel
19 Jinro
20 Kolon
21 Kohap
22 Dongbu
23 Haitai
The 45 Top Chaebol
of South Korea, 1997
Rank Chaebol
24 Hanil
25 Keo Pyung
26 Miwon (Daesang)
27 Sinho
28 Kang Won Ind.
29 Saehan
30 Dong Yang
31 Cheil Jedang
32 Shinsegae
33 Oriental Chemical Ind.
34 Woosung
35 Byuck San
36 Shin Won
37 Tongil
38 Taihan Electric Wire
39 Tongkook
40 Chong Gu
41 Keumkang
42 Sam Yang
43 Hankook Tire Mfg.
44 Pum Yang
45 Tae Kwang Industries
* experienced financial difficulties since 1997

Source: Sung-Hee Jwa, The Evolution of Large Corporations in Korea, Edgar Elgar, Cheltenham, UK, 2002.

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