The Great Unleveling: Long-Run Wealth Inequality in South Korea, 1970–2021

This paper constructs the first long-run estimates of top wealth concentration in South Korea from 1970 to 2021, using newly assembled estate tax tabulations and applying a simplified mortality multiplier method. The series uncovers a pattern that diverges sharply from the gradual postwar increase in wealth inequality seen in many Western economies. Korea experienced two distinct regimes: a two-decade period of low and stable concentration from 1970 to 1990, when the top 0.1 percent held a roughly stable 3 to 5 percent of wealth, followed by a substantial rise beginning in the late 1990s to a new, higher plateau of around 10 percent. This abrupt “Great Unleveling,” plausibly linked to institutional and market changes surrounding the 1997 Asian Financial Crisis, coincided with a shift in elite portfolios from land-based to financial assets. Independent property-tax records show that land concentration stayed flat across this break, indicating that the rise originated in financial rather than landed wealth. In international perspective, Korea moves from a low-inequality profile typical of developing economies to a moderately high-inequality regime similar to contemporary France and Japan. The findings highlight how sudden institutional breaks, rather than gradual trends alone, shape the long-run distribution of wealth. (Stone Center on Socio-Economic Inequality Working Paper)