An integrated energy policy for Korea: the case of an energy importing country

Economic theory defines a market failure when competitive markets cannot reach an equilibrium maximizing social welfare. One of its most typical examples has proved to be the energy market. Exhaustible energy resources provide the limits to economic growth, at least in the short term. Thus an energy policy for energy importing countries like Korea has been focused on minimizing the negative influences of external energy price shocks to the domestic economy. One of the possible directions for an integrated energy policy is suggested. The policy seeks to present a flow of policy rules which lead government policy to attain equilibrium, maximizing the national economic benefits by offsetting the market failure.