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From Flows to Stocks: Dynamic Causal Effects of Native and Immigrant Inflows in Korea‘s Declining Regions

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  • Juno Kim

    (Korea Institute for Industrial Economics and Trade)

Abstract

South Korea’s demographic crisis is compounded by an acute spatial imbalance, with the working-age population increasingly concentrated in the Seoul Capital Area (SCA). As policy shifts toward attracting both natives and immigrants to non-capital regions, this study estimates the dynamic causal effects of inflows on local population stocks in those regions. Using local projections with shift-share IVs, inflows of native working-age residents raise total and working-age population stocks in the short run, with effects persisting into the medium term but fading and becoming statistically insignificant after six periods. By contrast, immigrant inflows show no significant short-to-medium-run effects on native population stocks, though a decline appears at period 6, driven mainly by the working-age group.

Suggested Citation

  • Juno Kim, 2026. "From Flows to Stocks: Dynamic Causal Effects of Native and Immigrant Inflows in Korea‘s Declining Regions," Industrial Economic Review 022558, Korea Institute for Industrial Economics and Trade.
    • Handle: RePEc:ris:kieter:022558
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    JEL classification:

    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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