Final answer:
The Chaebol system is recognized as the key driver of South Korea's economic boom from 1960 to 1990. These powerful conglomerates, alongside significant investments in education, technology, and physical capital, as well as U.S. financial aid and effective economic planning, fueled South Korea's transformation into a high-income, technologically advanced economy.
Step-by-step explanation:
The driving force behind South Korea's economic growth between 1960 and 1990 is credited to the Chaebol. Chaebols are large, family-owned conglomerates that were instrumental in propelling South Korea's economy through diversification and industrialization. The Chaebol system fostered extensive growth in various sectors, including technology and manufacturing, leading to South Korea's rapid economic development and its reputation as one of the East Asian Tigers.
South Korea invested heavily in education and technology to increase labor productivity. This investment was supported by factors like a high rate of savings and strategic partnerships with other firms, which improved the country’s human capital and technological base. The country also benefitted from U.S. financial aid, which was a significant factor during the Cold War, and the government's effective economic planning contributed to South Korea's shift from an agrarian economy to an industrial powerhouse.
South Korea’s robust investment in physical capital was evident by their investment rates, which jumped from about 15% of GDP at the start of the 1960s to 30-35% by the late 1960s and early 1970s. This mirrored the actions of other rapidly-growing economies, which also heavily invested in their labor forces and technology to stimulate growth. As a consequence, South Korea joined the rank of high-income countries with technological prowess, similar to Japan and the United States.