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Kim, Yunhee
Lee, Jeong-dong
Heshmati, Almas
Year of Publication: 
Series/Report no.: 
IZA discussion papers 3774
This paper examines the relationship between pay inequality, economic growth, and performance in Korea. Pay inequality is estimated by using Theil's index to identify the factors determining the level of pay inequality, and establish its relationship with economic growth and performance. For the empirical results we use panel data on the Korean manufacturing sector for the period 1993 to 2003. It appears that a large portion of rising pay inequality can be attributed to rising relative pay among the small-sized firms, outside the capital city area and in the ICT sectors which were affected by the economic structural reform since 1997. The findings support the hypothesis of an augmented Kuznets Curve, according to which certain developed countries are found on an upward-sloping addendum to the original formulation of Kuznets.
Pay inequality
financial crisis
Kuznets Curve
economic growth
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Document Type: 
Working Paper

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