Recent debates surrounding state transformation in East Asia have tended to examine either how transformations in domestic social relations undermined the efficacy of the developmental state, or how mobilisation of coercion and consent at the international level led to the adoption of neoliberal policies. Through an examination of the case of Korea, however, this article seeks to move beyond this division between ‘domestic’ - and ‘international’ - centred analyses to provide a framework wherby mutually constitutive transformations taking place both at the level of social relations of production and at the level of the international order can be integrated to produce a conjunctural analysis of state transformation. Through deploying Gramsci’s concept of passive revolution, an analysis of social and geopolitical underpinnings of korean late development is provided in order to provide an alternative explanation of the causes and nature of transition towards the neoliberal state since the latter part of the twentieth century.