Korea has recorded spectacular economic and social advances in the past 30 years. This paper addresses, the following question without actually solving it: to what extent has this advance been enjoyed as well as experienced? How has it affected the living standard of the average Korean household? Do Koreans face the problem where they worry about "the figures prospering while the people suffer?" In this paper, we discuss on a broader level the effects of government policies on the living standards of Korean people by gathering available economic and social indicators on Korea and other relevant countries for the purpose of international comparison. Korea's economic development is characterized by rapid growth with a relatively equitable distribution of income. Along with the rapid economic growth of the past three decades, much progress has been made in the social development of the country. In the process of rapid economic growth, the standard of living of the Korean people has generally improved with economic progress. In particular, improvements in certain social indicators such as life expectancy, the infant mortality rate, the extent of housing supply, and the coverage of social security demonstrate the broad development benefits over the period. However, in spite of these improvements, the general perception is that social development has lagged behind economic growth in Korea. This gap between economic growth and social development is primarily due to Korea's development strategies. In the past, the drive for development was geared mainly towards economic growth and industrial development. As Korea enters the 1990s, it faces a critical historical challenge: how should its institutions solve various economic and social problems that are the unfortunate by-products of rapid industrialization and uneven growth? For example, income and wealth distributions, which were quite equitable by world standards in the early 1970s, deteriorated in the late 1980s, due mainly to the concentration of wealth among a small number of rich people. Moreover, urban Korea has serious quality-of-life problems centering on housing, transportation, and pollution while rural Korea suffers from lack of public facilities such as education, health, and sanitation. While the Korean model of an outward-looking development strategy has its merits and negative consequences, one consequence is unbalanced growth. The past three decades may be regarded as an important stage in the learning process while the search continues for an appropriate modernization model for Korea. Over three decades, Korea induced social and institutional change, but without due regard for human development. Thus, the new challenge that the political economy of Korea faces upon entering the 1990s is to reform and modify the present economic and social institutions in order to achieve the new guiding principle of translating economic growth into human development. In searching for economic and social institutions to serve Korea well into the 1990s and thereafter, it is important to understand that the realization of the full potential of human beings is both a means and an end in itself, and that the promotion of welfare should be a primary aim of development.