The Korean film industry: a “game changer”

Sweden and Korea have a very different approach to the film industry. Having a small domestic market, the Swedish film industry tends to see its comparative advantage in deepening its long tradition of producing “art movies” competing in festivals. In short, it has faced Hollywood dominance by cultivating different types of films. The Korean film industry has been impregnated with the US film tradition, with its first afterwar generation of film-makers — contemporaries of Ingmar Bergman — working closely with US film-makers. Possessing a much larger population than Sweden, the Korean industry has not hesitated to face Hollywood dominance by producing blockbusters. During this process, it has enlarged its palette of films produced, as most recently illustrated by the 2019 Palme d’Or won by Parasite.

One could assess the success or the failure of these two industries by discussing their goals — opposing art movies and blockbusters. This paper takes another approach. Rather, it seeks to understand why some film industries achieve their goal better than others. As a result, it needs a wider comparison base than two countries: this is why it presents an economic picture of the development of the six largest film industries in the world (excluding India) and Sweden.

The paper is organized as follows. Section 1 provides a snapshot of the main economic performances of these seven film industries in 2018. It may be a surprise for many readers to learn that the Korean film industry 1 I would very much like to thank Prof. Sonja Häussler for her kind invitation to the conference on the 60th anniversary of the establishment of diplomatic relations between Korea and Sweden. I would also like to express my deepest gratitude to Dr. Jimmyn Parc for his many constructive comments on the earlier version of this paper. This work was supported by the Laboratory Program for Korean Studies through the Ministry of Education of the Republic of Korea and the Korean Studies Promotion Service of the Academy of Korean Studies (AKS-2015-LAB-2250003). 68 pertains to the limited club of the world’s largest industries. The surprise is even bigger as the Korean industry is shown to be “outperforming” all the other industries, including the US, in almost all dimensions conceivable — audience, number of films produced, etc. As this result is based on one year (2018) and could reflect an ephemeral situation, section 2 digs further by adopting a long-term perspective: it compares the same film industries over thirty years; a period long enough to ensure robust observations and conclusions. The “growth trajectories” of these seven industries confirm the progressive rise to outperformance of the Korean industry. Section 3 explores the three best candidates for explaining this remarkable result: the role of the opening of the Korean film market to foreign competition in 1988; the embrace of this market opening by the new Korean film companies which emerged in the 1990s; and the cautious Korean film policy in the 2000s-2010s which has avoided —so far — the excesses of the policies of other countries which, by the way, have often harmed the industries they were supposed to support.