The trend of globalization in 20th century and Asian financial crisis shocked or, from some scholars¡¦ viewpoint, even ended the East Asian model of economic development, which challenged the role of state. However, according to the concept of ¡¥monopoly rent¡¦ by David Harvey, culture is based on countries, history, nations, and identities. These elements are all related to state closely. Therefore, in the era of globalization, the role of state will not disappear, but be transformed. The thesis will emphasize the role of Korean government in developing cultural industries and will discuss the national policies since 1998 after Korea recovered from its imminent bankruptcy. Korea was nearly bankrupted in the Asian financial crisis in 1997. In 1998, Korean government adopted cultural industry as a national strategic industry. It introduced a bundle of plans, policies, laws, subsidies, and established related official departments to benefit enterprises and people and promote other industries. The strategies re-established national economy successfully; moreover, the ¡§Korean Wave¡¨ was formed and became a trend in Asia. Furthermore, the thesis starts from reviewing Korean history, including Confucianism, Buddhism and Taoism from China, colonial culture from Japan, and Western culture from American armies. From the context of penetrating foreign culture influence, the thesis points out the components of Korean cultures, and uncovers Koreans¡¦ national and cultural identities, formation of nationalism, and global strategies of cultural industries.