The TeenBiz 2014 January by theteenbiz

2014. January

The Entirely Student-Run Business Newspaper:

The TeenBiz

UM VOL

Editor: Stephanie Y.

This Month’s Hot News:

Controversy over Sweden’s Korean Education System: What Is True Education?



Controversy over Sweden’s Korean Education System?



DO YOU AGREE OR DISAGREE?

Writer: Bongha Lee Editor: Seunglee Lee



Korea On the Intersection of Three Pathways



All-Out War to Boost Domestic Demand



Retro Marketing



Japanese Automobile: High Fuel Efficiency

The highly controversial Korean educational system is now subject to debate in the Swedish Educational Department. Therefore, the pros and cons of the so called “Miracle of Korean Education” have been in the spotlight.



High Sales Commiss ions of Department Stores NO MORE POVERTY IN THE WORLD

Contents: Sweden-Korean Education

Do you agree or disagree?

Korea on Intersection of Three Pathways 2,4 Domestic Demand Retro Marketing

Volume 3. News 1.

3 3,4

Japanese Automobile 5 High Sales Commissions of Department Stores 5 No More Poverty in the World 6

The Swedish Minister of Education bitterly rebutted the view of Stefan Loefven, his opposition and the Social Democrats leader, who favorably embraced the Korean education system as “an innovative stimulus for qualitative improvement and quantitative expansion of Swedish education”. Jan Björklund, the Deputy Prime Minister of Sweden and Minister of Education, clearly stated his disagreement with the Korean educational system, the epitome of fierce competition and overwhelming stress. Björklund boldly published his criticism against the Korean schooling system in his Dagen Industri (DI) article. He pointed out, “Loefven suggested the Korean education system as an example for us to follow, but OECD studies have been critical of the Korean system, which prioritizes educational growth but disregards the quality of tertiary education.” He added, “It's part of the

reason why Koreans are so passive. Since young, they’re conditioned to learn only what they need to know. Even in college, kids only want to learn what's going to be on the test and never anything else. Once they join society, they do not do anything other than what they are expected to, and anyone who strays from that pattern is ridiculed or criticized for acting up.” Björklund pointed out in the article, “Education is not only Korea’s problem... Sweden should never copy anything from Korea. Korea is in the culmination of every flaw of capitalist countries.” The press supported Björklund’s statement and criticized the movement as “an inconsistent approach for boosting the student through incompatible comparison of education between two different countries culturally, socially, and educationally.” In opposition to Loefven’s statement , Korean students responded in outrage to the modeling of Korean educational standards in Sweden as “a misinterpretation of the book of Korean education only by its cover,” and for emphasizing the tragic consequences of forcing students to work 40 hours a week and study 60 hours per week — a high suicidal rate.

Ironically, the level of education among the Swedish people has risen sharply over the last few years. Last year, the Swedish Department of Education reported the total first-time applicants to higher education to be 257,000 out of 403,000, which is contrastingly higher than Korea’s statistics. The large tax avenue also helped the enrollment through generous financial aid. In 2012, it publicly funded over SEK 37 billion, or 1.04 per cent of its GDP, toward research. By contrast, Korea placed 24th in the U-21 rankings assessment of high school education systems in 40 countries on the basis of resources, environment, relevance, and performance, whereas Sweden rose to second place right below the United States. The possibility of adopting Korean schooling system in Sweden has brought great controversies. However, it is unlikely that Sweden will abandon its highly praised education system.

The TeenBiz

DO YOU AGREE OR DISAGREE? Writer: Jane Park Editor: Minsung Kim You must have heard about Korea’s privatization policy recently. In fact, trail privatization and health care privatization are hot issues these days, and the majority of citizens are disagreeing with the policies. Before recognizing the reason behind their disagreement, let me explain to you what privatization is. What is privatization? It is a process of private enterprises taking over public enterprises or institutions. That is, private enterprises become the real managers of these corporations. But be careful. You can misunderstand the process! Privatization actually has good points too, not only bad points. Let us talk about the advantages. First, a small government could be realized because it would maintain a size of a government to be as small as possible. Second, a non-public economy could be reborn because of the inflow of capitals or human resources. Lastly, by reducing the cost, efficiency could be reinforced. Examples of privatization are POSCO, KT and KT&G. You may know about the disadvantages. The largest problem is that the 'real' price consumers pay skyrockets. This is why privatization has become such a hot issue.

Now that we know the definition, drawbacks and benefits of privatization, let us get to the point. Probably, if you were to pick a hot issue in December 2013, you guess the privatization of the railroads would be it. This happening broke out because 8,565 Ko-rail workers were fired and people thought the government pushed too far in privatization. Also, due to the issue of the hand-written posters that read 'Are You doing well?' the doubts were magnified and people became annoyed. Since the trains are thrown under private management, the fare would get much higher. And due to the problem of this privatization, the problem regarding health care is also on the rise. The best example that shows the weakness of privatization is the United States of America. The USA is a country where health care privatization is still running. Since a patient needs to cover the entire medical expenses, most of the ordinary citizens cannot afford this cost. You may have heard of this story of a man who has hurt two fingers but did not have enough money to get a proper medical care, so he had to just sew up one finger and give up on the other one. Although the Korean government officially announced that privatization would not be put into action, some people place doubt on the words. What do you think about privatization? Do you agree or disagree?

Korea On the Intersection of Three Pathways : Culture, Economy, and Politics. Writer: Sangtae Ahn Editor: Annie Song Before starting this article, I want to express my worry if it can be begrudging and inflammatory for somebody. Outbursts of concern, criticism, and anger in the last quarter of 2013 in Korea society have emboldened me to elaborate on such topics that are hard to deal with. This article is inspired by the spread of hand-written posters throughout Korean Universities and the timely release of a Korean Movie, The Attorney. This movie is about Korea during the 1980s and is strongly resonating with the current Korean society. I would like to point out the important linkage between the cultural phenomenon and economy, followed by my critical viewpoint onto the Korean Society. Accompanied by arisen doubts on the intervention of the National Intelligence Service into Korean presidential election of 2012 and nationwide strikes against the privatization of Korean public railroad enterprise, Korail, the Korean society has been starting to agitate vehemently.

In response to the socially contentious revelation of truth, students ranging from high school to university picked up their pens and voiced their discontents, claiming, “We are not doing well.” Their widespread discontent brought out huge repercussion and ignited the conflict between the Left and Right wings of the government. On the other hand, some people harshly criticized the protesters for distorting facts and argued against their whole assertions as well as their anti-governmental attitude with a response, “We are doing well.” This nationwide debate, however, inspired the critical viewpoints of young generations on society and reassured them to be proactive enough to proclaim their opinions, as elder generations of 1980s had done.

Continued on Page 4

V olume 3. New s 1.

[2014 Economic Policy] All-Out War to Boost Domestic Demand Writer: Sooji Kim Editor: Seunglee Lee

Employment Rate (15-64) 65.4 65.2 65 64.8 64.6 64.4 64.2 64 63.8 63.6 2012

2013

2014

Gross Domestic Product 5 4 3 2 1 0

Korea PPP

2012

2013

2014

Even though key economic indicators are improving this year, consumers’ sentiments toward the nation’s economy are still in doldrums. In order to invigorate public economy, the government decided to focus on boosting domestic demand. This policy can be interpreted as the government’s will to expedite economic recovery.

a burden to Korean households. To lighten private education costs, the government aims to foster a transparent private education market and reinforce after-school curriculum. According to the economic policy plan, the government plans to establish domestic traveling activation plan and households’ debt management plan in January. In March, they plan to launch regional economy activation plan, lower private education costs, and expand rental house supply. Plans for reinvigorating the spending market and encouraging regional cooperation will be established by May. In June, the government plans to propose remedial measures for industries and increase efficiency of physical distribution services.

One of the major plans of government is to increase investment and consumption. To resolve the recession, the government decided to mobilize foreign exchange holdings to support businesses’ investment in plant and equipment. The government is planning to aid maximum of 10 billion dollars of foreign exchange holdings to banks that help businesses by easily lending them money. Also, they decided to establish the application plan While briefing the 2014 for ‘sleeping money’ such as credit card points, mileage, and dormant de- economic policy, Hyeon Oh-seok, the deputy Prime Minister and the Strategy posit. and Finance Minister, emphasized that, In addition, the government “Economy is a life, not a number. We presented a policy of lowering private will put our best effort in establishing education costs to improve public policies until the public can feel the spending. Along with Korean parents’ warmth of economic renewal.” high interest in education, the private education market is going through a rapid growth and in return is becoming

Retro Marketing Writer: Taeju Kim The drama “Answer 1994” is currently popular among people in mid 30-40s. Last year, the prequel, “Answer 1997” was also very popular. “Answer 1994” and “Answer 1997” both deal with the culture of the 1990s, making the people in their 30~40s to look back at their teenage years. As people remember those times as “the good old days,” watching dramas like these let people become free from their stressful life. There is a type of marketing using the consumers' attachment to their past, called Retro Marketing. Retro Marketing refers to adding new points to a popular style of the past. As Retro Marketing has people's general feelings as its

basis, this marketing strategy has much bigger ripple effect than temporary fads. In the business' point of view, there are two big merits: the decrease in the cost for a new brand and stable results that can be expected as there is already a loyal consumer class. According to Professor Steven Brown of University of Ulster in Britain, Retro Marketing starts from changing the perspective businesses look at consumers . Continued on Page 4

V olume 3. New s 1.

Korea On the Intersection of Three Pathways : Culture, Economy, and Politics - Cont’d It was a lucky strike for the director of a movie, the Attorney, to release it in this period; the timely premiere of the movie resulted in hitting jackpot in Korean Box office. This movie is motivated by the life of the previous president of Korea, Muhyun Noh, who stood with those suppressed by governmental authorities. Its description of Korean government – undemocratic, unfair, and unjust – fairly (or regretfully) resonate the current circumstances of Korean society; in 1980s happiness and democratic independence of people were taken away by the government in the name of stability. The director of the movie points out the importance of sovereignty as a person by reflecting the theme through the persona of characters. The movie is most likely to provoke people’s anti-governmental attitude by the Right wings. Many people, including I, agree that the movie is overrated and buoyed to alert audiences to some degree. However, it allows us to find out about the parallels between current and 1980s undemocratic Korean society. Another inspiration of this article was drawn from an article related to the institutional economics. In the article “Glorious revolutions and their discontents” from economist.com, the

author introduces a complex correlation between institution and economy which has been regarded as an esoteric debate. The article explores historical observations of correlation between institution and economy as theorists discuss the obscure interrelation. Douglass North and Barry Weingast, two prominent economists, contended the strong correlation between institution and economy through their publication in 1989 by providing instance of England Parliament’s Glorious Revolution, while new scholars such as D’Maris Coffman, Adrian Leonard and Larry Neal argued against the theory. This made me remindful of the imbalance between economy and institution in Korea. The degree of economic growth Korea accomplished in a few decades definitely outwitted that of political (or democratic) growth. The asymmetry made the lagged Korean politics brought into relief now. As some people might protest with criticisms, it might still be presumptuous for young students like me to critique on general and social phenomenon. We are too young and naïve to discern what is absolutely right or wrong. Nevertheless, as many elder people habitually emphasized, we are the next generation who will be

responsible of the society. Despite some logical fallacies in our arguments and false data, our voices of discontent will help shape our society to become more mature and firmly based. It will engrain the basis of development, and balance the economy and politics in Korea.

Retro Marketing - Cont’d With this, he suggested five important things that a product must have in order for a retro marketing to be successful: limitation, secrecy, amplification, fun, and tricks. First, a product needs limitation of the supply, thus delaying the satisfaction coming from it. Second, a product needs secrecy. Do not show all of the product's aspects at once, or it will only be able to be a temporary fad. Third, a product needs amplification within the consumers' mouths. Make sure the product doesn't stop being the topic of talks. Fourth, a product needs to be fun. It has to catch the mind of consumers with interest. Last, consumers should all enjoy a pleasant trick.

V olume 3. New s 1.

Japanese Automobile: High Fuel Efficiency Writer: Larry Jeon Editor: Stephanie Y. Automobile industries that are mainly centered around developed countries will be competing in the market with their newly invented environment-friendly and high-fuel efficient functions in the next coming year. This alarms Korean automobile companies that still lack technology in producing such eco-friendly automobiles. According to the Korean Automotive Research Institute, the Japanese automotive industry will play a main role in the upcoming competition to improve fuel efficiency and cause less pollution. A new gasoline engine coming out next year has been developed to be more than 10% fuel efficient, equipped with two new technologies such as turbo charger and the highly-pressed fuel-injection system. Toyota in fact has reduced a 2.5 liter gasoline engine to 2 liter while equipping its products with newly designed diesel engines to satisfy their customers. Honda has also developed a VTEC turbo that can be implemented to less than 2000cc automobiles. In the U.S. market, Volkswagen is preparing to

compete with Japanese automotive companies by creating new parts like TDI clean diesel. But this is not the only field that the Japanese automobile firms are entering

friendly cars. Only has Hyundai invested more than 2.5 billion U.S. dollars into R&D for hybrid automobiles.

In the field of Hybrid automobiles, as a countermeasure to Honda’s 36km per liter hybrid engine, Volkswagen has improved its engine parts and hybrid control system into a 37km per liter hybrid engine in its Volkswagen Aqua. More than that, Toyota’s Prius 4th series will be upgraded with specialized gasoline engine, high voltage battery, and weight lightening with aluminum, which aims for fuel efficiency of 40km per liter. Suzuki, for the coming 2016, is planning to apply its technology to downsize the engines in its Swift series. On the contrary, Korean automobile market is showing no response to the diligent changes in the global car industry. They have invented a few fuel-efficient engines in the beginning of 2010s, but recently have made no attempt to generate eco-

High Sales Commissions of Department Stores Writer: Eunyoung Lee Editor: Stephanie Y. The Fair Trade Commission revealed the results of the investigation on sales commissions of seven department stores and six TV home shopping companies. The average of seven department stores' sales commissions was 28.5%, a only 0.1% decrease compared to last year. Similarly, the average of six TV home shopping companies' sales commissions was 34.4% a 0.5% increase compared to last year. In 2011, these large-scale retailers said that they would decrease their sales commissions by three to seven percent to share growth with neighbor companies, but they broke their words.

Sales commissions of clothing products were high and those of electronics, books, toys were comparatively low. (shirts and ties34.9%, suits for women -32.3%, products for children and infants-31.8% , and digital devices -9.8%, large electronics 13.6%) The Fair Trade Commission has said that they will increase the distribution of scores during the evaluation process of the convention deal in order inducing a decrease in sales commissions. In addition, they pronounced that they will reinforce their surveillance on improper changes of sales commissions during the contract periods. .

V olume 3. New s 1.

NO MORE POVERTY IN THE WORLD Writer: In Hyuk Kim Editor: Stephanie Y. In China, a lot of people have suffered from poverty. The poor cannot afford enough money to maintain their livelihood. However, nowadays, China’s dramatic economic growth plays an important role in reducing the country’s poverty rate. Its poverty rate has fallen from 40% to 20% within the two decades, according to the World Bank. China has experienced rapid economic growth and industrialization so that many poor of the rural areas of the country could move to the urban centers. It means that the poor are now able to have more opportunities to get jobs in manufacturing factories. Furthermore, since the education and healthcare have improved a lot by policies set by the new Chinese government, many citizens can live more conveniently. In addition, the global poverty rate has also fallen from 26% in 2007 to 7% by 2012 within six years, according to the Gallup report, the U.S. researched -based consulting company. Even though some populated countries have reduced the poverty rate, sub-Saharan African countries still retain the highest levels of poverty. About 54% of the whole population in those countries is living under extreme poverty. Therefore, there are still many problems which all of people need to solve together. The World Bank, moreover, expects a 3% reduce in the global poverty by 2030.

This Month’s Writers: Thank you for your contribution. Annie Song, Seunglee Lee, In Hyuk Kim, Bongha Lee, Jane Park, Larry Jeon, Sangtae Ahn, Taeju Kim, Sooji Kim, Eunyoung Lee, Minsung Kim

The Entirely Student-Run Business Newspaper WWW.THETEENBIZ.ORG