When I assess the world's economic health—which I'm often called upon to do, as both an international financial consultant and a professor of finance at Babson College—I'm very optimistic about what I see.

It's an outlook I explain in my recent book Brave New Wealthy World: Winning the Struggle for Global Prosperity. I believe the wealth of countries around the globe is becoming more stable, more resilient, and self-propagating, able to withstand hits that in the past would have brought it crashing down.

Not long ago, in fact, I got to observe an amazing rebound up close, one engineered by South Korea. In the wake of the Asian financial crisis of 1997, I was asked to be a consultant for the financial services industry in Seoul.

South Korea's capital is a big, spread-out, contradictory city. Modern amenities and the latest telecommunications hardware have been retrofitted into buildings several generations old. A typical taxi ride reveals remarkable stages of growth—well-preserved feudal palaces, a striking railroad station, the sky-high futuristic tower that overlooks the city's expanse.

Fashionably dressed people talk on tiny cell phones as they hurry from one engagement to another. Enjoying a vibrant prosperity, they have extra money to spend in the coffee bars and restaurants that fill the city. Most have studied English, though only a few would ever consider approaching a foreigner to try out phrases.

After the Korean War, the country's financial system worked well enough to bankroll astonishing development. Much like Japan, the South Korean economy was dominated by huge industrial conglomerates. Then the 1997 financial crisis hit. The banks at the center of the industrial groups found themselves with too many loans extended to group members. Liquidity dried up. The exchange rate weakened. The whole edifice of the country's economic miracle was tottering.

South Korea badly needed to fix its financial system's structural defects (for instance, it channeled too much of its savings into projects promoted by the big conglomerates). When I arrived there, I immediately saw it was ready to do just that. The South Koreans were not going to be content with putting a new façade onto an old system.

One large bank was planning to merge with another of almost equal size, a healthy step toward building a new financial system. Over several years, I worked with bank executives and employees as they prepared themselves for the new operating methods that consolidation and repositioning would bring. My job was to help them prosper in their new environment.

But corporate consolidation causes trauma and upheaval everywhere, including in South Korea. I worked with people in their thirties and forties who were struggling to understand what I was saying—not because of a language barrier, but because they were having to unlearn ingrained work habits and throw off lessons gained through experience.

In general, the businesspeople I met were receptive and very nice. Still, it was sometimes hard to bridge the culture gap. I think they often saw me as an austere professor and expert who was sitting in judgment of them. They were deferential, not enough at ease to let their hair down.

When I was working with them, I could feel their tension and see the wariness in their demeanor. They knew a big layoff was coming. Each of the merging banks had executives doing similar jobs; where there were two people, soon there would be only one.

And the pressure to perform affected entire organizations, not just individuals. Banks throughout South Korea struggled to find new lines of business that would help them maintain profitability and growth. As lending to the big industrial groups fell out of favor, consumer lending took on a new allure.

This created its own changes. Low-rate mortgages fueled a speculative boom in real estate. Credit card companies set up tables along the streets near the universities, blared rock music from sound trucks, gave away food and T-shirts—and signed up new accounts in droves, putting credit lines into the pockets of college students who had no experience with the magic of plastic.

For a time, the new emphasis on consumer lending seemed to be working. Then the honeymoon ended. Lenders discovered some consumers were using one credit card to pay the monthly minimum on another. Soon the country's financial system had another hangover to deal with—cleaning up after a consumer borrowing binge.

But the situation was far less severe than what had followed the 1997 crisis, and, in some ways, much more encouraging. Even though considerable losses had to be written off, the newly restructured system adjusted easily to the setback. The shares of several financial institutions dipped for a time, and a few top executives had to resign. Yet the net effect was small. South Korea's exchange rate hardly quivered, and its rapid economic growth continued with barely a hiccup.

It was an extraordinary and reassuring sign of financial strength. I felt privileged to have had the chance to witness South Korea's stability first-hand. I'm convinced it bodes well for the world as a whole.