Learn economic lessons from the Olympics

We hope to see a new competitive environment where companies can demonstrate their full capabilities in a fair and transparent system.

SHIN MIN-YOUNG The author is a visiting professor of economics at Hongik University.

The Paris Olympics are in full swing. Clean results are part of the charm of sports. Athletes practice tirelessly and do their best to win.

In this year’s Olympic Games, Korean athletes had outstanding performances and won gold medals in archery, shooting and fencing. Unlike other sports such as track and field, basketball and volleyball, the common feature of these sports is that physical strength or conditions have little impact on the outcome. Another common aspect is that the result is determined by athletes’ scores based on the rules of the game. Many sports matches are determined by scores, but archery and shooting are events where a referee’s discretion has little room to affect the results of matches.

The introduction of the automated ball-strike system (ABS) for Korean professional baseball this year has a correlation with Korean athletes’ performance in certain Olympic events. The ABS drastically reduced disputes over umpire judgments. Another achievement in the Olympiad is the superb performance of our young athletes during a generational change.

After all, it is difficult to say that Korea can enjoy favored decisions in international sports thanks to its power and influence. Korea does not have overwhelming economic power, either. Compared to companies, Korea is still more of a startup rather than a business giant. Nevertheless, Korean athletes did well in the archery and shooting events with little room for referee decision.

Korea was the biggest beneficiary of the post-World War II free trade system represented by globalization. As tariff and non-tariff barriers decreased, the rules of the game in the economic battleground were no longer favorable to certain countries and referees’ biased decisions also decreased. Korean companies could expand their overseas markets as long as they did their best to enhance competitiveness.

Although an environment for fair competition was created at global levels, there seems to be a long way to go for the Korean economy, domestically, due to the country’s fast aging population. But a bigger problem is that the industrial structure is growing old. When looking at the export structure, there is no change in the composition of major items from 10 or 20 years ago. No new company is emerging as a large company.

Analysts attribute it to overly close ties between the government and the corporate sector as well as stifling regulations. Industries must learn from the amazing performances of our athletes in archery and shooting — partly thanks to the fair and rule-based competition back home — and must learn lessons from the pitiful regression of Korean football trapped in perennial connections. We hope to see a new competitive environment where companies can demonstrate their full capabilities in a fair and transparent system.