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Identifying the Potential Influences on Income Inequality Changes in Korea – Population Subgroup Analysis

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  • Younguck Kang

Abstract

This study measures the direction and size of contributions of a number of different individual characteristics on the significant increase in the household head wage income inequality indexes in Korea between 1988 and 2002. Based on the Urban Household Income and Expenditure Survey (UHIES) from the National Statistics Office (NSO), basic analysis based on the empirical findings suggests a strong market institution such as ‘seniority based’ salary system that limits the wage determination through market forces may have contributed to the statistically significant increase in the household head wage income inequality. The analytical tool used in this study is based on the Jenkins’ (1995) dynamic decomposition by population subgroup method for measuring the effect of potential influences.

Suggested Citation

  • Younguck Kang, 2006. "Identifying the Potential Influences on Income Inequality Changes in Korea – Population Subgroup Analysis," International Review of Public Administration, Taylor & Francis Journals, vol. 11(2), pages 70-86, January.
    • Handle: RePEc:taf:rrpaxx:v:11:y:2006:i:2:p:70-86
    DOI: 10.1080/12294659.2003.10805086
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    1. Lambert, Peter J & Aronson, J Richard, 1993. "Inequality Decomposition Analysis and the Gini Coefficient Revisited," Economic Journal, Royal Economic Society, vol. 103(420), pages 1221-1227, September.
    2. Cowell, Frank A & Jenkins, Stephen P, 1995. "How Much Inequality Can We Explain? A Methodology and an Application to the United States," Economic Journal, Royal Economic Society, vol. 105(429), pages 421-430, March.
    3. Jonathan Morduch & Terry Sicular, 2002. "Rethinking Inequality Decomposition, With Evidence from Rural China," Economic Journal, Royal Economic Society, vol. 112(476), pages 93-106, January.
    4. Shorrocks, Anthony F, 1984. "Inequality Decomposition by Population Subgroups," Econometrica, Econometric Society, vol. 52(6), pages 1369-1385, November.
    5. Shorrocks, A F, 1982. "Inequality Decomposition by Factor Components," Econometrica, Econometric Society, vol. 50(1), pages 193-211, January.
    6. Younguck Kang, 2006. "How Much Do We Know About Income Inequality in Korea?," International Review of Public Administration, Taylor & Francis Journals, vol. 10(2), pages 85-101, January.
    7. Jenkins, Stephen P, 1995. "Accounting for Inequality Trends: Decomposition Analyses for the UK, 1971-86," Economica, London School of Economics and Political Science, vol. 62(245), pages 29-63, February.
    8. Silber, Jacques, 1993. "Inequality Decomposition by Income," The Review of Economics and Statistics, MIT Press, vol. 75(3), pages 545-547, August.
    9. Fields, Gary S & Yoo, Gyeongjoon, 2000. "Falling Labor Income Inequality in Korea's Economic Growth: Patterns and Underlying Causes," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 46(2), pages 139-159, June.
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