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Title:Changes in Korean wage inequality, 1980-2005 PDF Logo
Authors:Kang, Byung-goo
Yun, Myeong-Su
Issue Date:2008
Series/Report no.:IZA discussion papers 3780
Abstract:Korea is known not only for rapid economic growth but also relatively low wage inequality. It is one of the few countries in which wage inequality decreased during the 1980s, though in recent years wage inequality has increased. This paper studies what factors contributed to the changes in wage inequality during the last two decades. This paper implements a recently developed Oaxaca-type inequality decomposition method to decompose U shaped changes in inequality into characteristics (quantity), coefficients (price) and residuals effects at both overall and detailed levels. The results of decomposition analysis show that changes in the wage structure significantly contribute to the changes in wage inequality in Korea. The coefficients effect of human capital factors has played a major role not only in increasing wage inequality from mid-1990s, but also decreasing wage inequality in 1980s and early 1990s.
Subjects:Decomposition analysis of inequality
earnings equation
coefficients (price) effect
characteristics (quantity) effect
residuals effect
JEL:D30
Persistent Identifier of the first edition:urn:nbn:de:101:1-20081126399
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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