Ostasien Aktuell Building a Welfare System through Bounded Learning: A Case Study of Korean Long-Term Care Insurance

This study verifies three conditions in its aim to confirm the influence of Japan’s experience on the introduction timing and policy model of the Korean LTCI. First, the LTCI systems in Korea and Japan agree in terms of their core principles. Both are based on a separate social insurance system and ensure financial sustainability at the expense of service quality in response to the need to elevate expenditure. Second, the policymaking process reveals the reference relationship between the two systems. The advocacy coalition for LTCI suggested introducing an LTCI based on Japan’s experience. However, their rationale was constrained due to the bounded rationality of policy learning. Finally, this study demonstrates that the rival arguments cannot completely explain the introduction of the Korean LTCI without considering the bounded learning argument. Consequently, the results of this study indicate that policy learning is critical to welfare development in latecomer welfare states.