Innovation & Wealth › Mass production & the consumer age › East Asian economic miracles
Samsung (Lee Byung-chul)
founded March 1938, Daegu· Company or fortune· Companies & fortunes
Well documentedSolid records, texts or physical evidence.
A 1938 Daegu trading shop that grew into South Korea's largest conglomerate and long the world's biggest memory-chip maker.
See it on the Innovation & Wealth map →What happened
Lee Byung-chul (이병철, 1910–1987) founded Samsung Sanghoe (삼성상회, 'three stars') in March 1938, under Japanese rule, trading dried fish and noodles. After the Korean War he expanded into sugar, textiles and insurance with state credit. Samsung Electronics (1969) began with TVs and bet big on memory chips in 1983. Under his son Lee Kun-hee it led global memory chips from the early 1990s and later smartphones. Lee Kun-hee's 2020 estate was about $22 billion; the family owed about $10.8 billion in inheritance tax.
Impact on society and the economy
It drove Korea's export economy, supplying roughly a fifth of exports. Shareholders, engineers and Korea's economy gained; critics cite union suppression, tight family control and bribery convictions later pardoned.
How we know
Company histories and financial filings, Korean court rulings, Korea's export statistics, and market-share data from chip and phone industry research firms.
Still debated
Whether chaebol like Samsung were essential to Korea's rapid growth or crowded out smaller firms remains debated in Korea and among economists.
Connections (4)
▸Meiji Japan and the zaibatsu were a model for chaebol such as Samsung (Lee Byung-chul)Mostly agreed
The connection
Japan's zaibatsu were family-controlled groups, like Mitsubishi and Mitsui, spanning banking, trade and industry with state support. Lee Byung-chul studied in Tokyo; Samsung, founded in 1938, later grew along similar lines. After his 1961 coup, Park Chung-hee (박정희), trained in Japanese military academies, steered credit to favored family groups. The word chaebol uses the same Chinese characters as zaibatsu.
When and how
Japan, 1870s–1945; Korea from 1938, especially under Park, 1961–1979. Lee studied at Waseda University in Tokyo, and Samsung Electronics partnered with Japan's Sanyo and NEC from 1969.
How sure are we?
The shared term (財閥), Lee's Japanese education and partnerships, and studies of Korean development by Alice Amsden and others document the borrowing.
Debates
Unlike zaibatsu, chaebol could not own banks and depended on state loans; how much was copying versus Korea's own path, shaped by US aid, is debated.
▸Samsung (Lee Byung-chul) competes in chipmaking with TSMC (Morris Chang)Well documented
The connection
Samsung, the biggest memory-chip maker, also builds logic chips for outside customers, competing directly with TSMC's foundry business. Both race toward smaller transistors; Samsung began 3-nanometer production first, in 2022, but TSMC's better yields won most big customers. By 2025 TSMC held about 70% of the foundry market and Samsung about 7%, by TrendForce estimates.
When and how
Hwaseong and Pyeongtaek, South Korea, and Hsinchu, Taiwan; head to head since Samsung expanded its foundry in the 2000s and made it a separate unit in 2017.
How we know
Industry market-share data, company earnings and customer announcements, such as Apple's and Nvidia's reliance on TSMC and Tesla's 2025 chip deal with Samsung.
Debates
Whether Samsung can close the gap, partly at its Taylor, Texas plant, and how much customers will pay for a second supplier, are open.
▸Samsung (Lee Byung-chul) became the chief rival of iPhone and the smartphone platform economyWell documented
The connection
Samsung was first a supplier, making the processor chips for early iPhones, plus memory and later screens. Its Galaxy S (2010), running Google's Android, became the iPhone's main rival. Apple sued in 2011 for copying; a 2012 jury awarded about $1 billion, later cut, and they settled in 2018. Samsung led sales most years since 2011; Apple takes most profits.
When and how
Suwon, South Korea, and Cupertino, California, 2007–2018; court fights in San Jose and about ten other countries.
How we know
Chip teardowns of early iPhones, court records from Apple v. Samsung, and market-share data from research firms such as IDC and Counterpoint.
Debates
Who copied whom remains argued: Apple pointed to design patents, Samsung to its wireless technology patents, and courts split across countries.
▸South Korea's export-led five-year plans favored chaebol such as Samsung (Lee Byung-chul)Well documented
The connection
Park's government steered cheap loans, import licenses and tax breaks to firms that met export targets. Samsung, a trading company since 1938, used that support to expand from sugar and textiles into electronics (Samsung Electronics, 1969) and later memory chips, growing into Korea's largest chaebol.
When and how
Seoul, 1960s–1970s. Accused of illicit profiteering after the 1961 coup, founder Lee Byung-chul reached an accommodation with Park and became a partner in industrialization.
How we know
Government credit records and studies of Korean industrial policy document preferential loans to chaebol, including Samsung's moves into new industries.
Debates
Whether chaebol favoritism was efficient picking of winners or crony capitalism that bred debt and corruption is debated; Samsung's government ties produced bribery scandals into the 2010s.