[KS] How unequal is South Korea, really?

Ruediger Frank rfrank at koreanstudies.de
Mon Aug 21 02:39:34 EDT 2006

Dear Aidan,

far from telling the whole story, here's what economics tell us. The usual index for 
(in)equality is the Gini coefficient. It has values between 0 (perfect equality) and 1 
(perfect inequality). Don't want to bore you with the details; if interested, just check 
out Wikipedia. The Gini coefficient for SKorea is pretty low - around 0.31, for Taiwan it 
is around 0.33, Singapore had 0.42 in 1998. Korea does pretty well if compared to, for 
example, the USA (0.408), Germany (0.382), the UK (0.36) or France (0.327).

Vincento Spiezia (http://www.oecd.org/dataoecd/43/0/15179780.doc) did interesting research 
on geographic income distribution that provides some kind of alternative/supplement to the 
Gini coefficient. By the way, he mentions Korea as one of the few cases in the OECD where 
geographic concentration of production mainly reflects concentration of population.

Interestingly, disparity in regional income distribution in Europe is highest in the UK, 
Belgium, Germany and France, and lowest in Poland, Portugal, Greece and Ireland (since 
you're Irish, you might want to check out 

To make it short, I guess the low Gini coefficient is one reason why Korea is said to be 
highly egalitarian. My limited personal experience supports this view. I guess Koreans 
just sometimes have that tendency to downplay their own successes (or to overemphasize 
them at other instances). It's a country of extremes - but not for Mr. Gini.

Hope this helps.



Afostercarter at aol.com schrieb:
> Dear colleagues,
> A large question, which has been bugging me for some time:
> *How unequal is South Korea, really?
> *There is a paradox:
> * In the development literature, South Korea (and Taiwan) are
> routinely cited as examples of highly egalitarian societies:
> a fact often linked to their early and thorough land reforms.
> * Yet that is not at all how most South Koreans themselves see it.
> In Seoul, inequality and "polarization" are major worries, across
> the political spectrum. President Roh has made reducing inequality
> one of the two top goals for the remainder of his presidency
> (the other being to achieve a  free trade agreement with the US).
> Who is right? Can these views be reconciled? A few thoughts:
> 1. There are many kinds of inequality. This debate seems not to be
> about eg _gender_ inequality, which remains manifest and pervasive.
> 2. What about _regional_ inequality? Despite Seoul as vortex and the
> Honam-Yongnam divide, the alleged rationale for moving the capital
> seemed quite unconvincing. In this respect, South Korea looks quite
> homogeneous when compared to many (most?) other countries.
> 3. Similarly, the visible _income_ inequalities of a Brazil, China, 
> India, et al
> are surely far more extreme and pressing. At least to an outsider, among
> all the socio-economic challenges which South Korea currently faces,
> income inequality is hardly the first that would spring to mind.
> Why then do Koreans see it differently? A few hypotheses:
> 4. One should distiguish _income_ (flow) from _wealth_ (stock).
> The latter, as everywhere, is liable to be more unequal.
> 5. Income inequality may indeed have _worsened_ since the 1997-98
> financial crisis, as has job insecurity. Is S. Korea measurably less
> equal than it was, or does it just feel that way? And in either case,
> has it become less equal compared to other countries?
> 6. Polemically, my instinct is to file all this as yet another case where
> current South Korean debates tend to be subjective and inward-looking;
> with a real risk that pursuing chimeras may produce misguided policies.
> 7. However, the clipping below suggests there may be something in
> these plaints after all - although note SERI's view that, ironically, 
> the Roh
> administration has made matters worse by (to paraphrase) focusing on how
> to slice the cake, rather than getting on with baking a bigger and 
> better one.
> 8. I bet North Korea is far more unequal than the South, had we the figures.
> Enlightenment, please!
> best wishes
> Aidan
> Honorary Senior Research Fellow in Sociology & Modern Korea, Leeds 
> University
> Home address: 17 Birklands Road, Shipley, West Yorkshire, BD18 3BY, UK
> tel: +44(0)  1274  588586         (alt) +44(0) 1264 737634          
> mobile:  +44(0)  7970  741307
> fax: +44(0)  1274  773663         ISDN:   +44(0)   1274 589280
> Email: afostercarter at aol.com     (alt) afostercarter at yahoo.com      
> website: www.aidanfc.net
> [Please use @aol; but if any problems, please try @yahoo too - and let 
> me know, so I can chide AOL]
> ________________
> http://search.hankooki.com/times/times_view.php?term=esteban++&path=hankooki3/times/lpage/200608/kt2006081717480310230.htm&media=kt
> South Korea's Income Gap Wider Than in Developed Countries
> By Lee Hyo-sik
> Staff Reporter
> The income gap between the rich and poor in South Korea has deepened 
> over the years, becoming wider than in most developed countries, 
> including the United Kingdom and Japan.
> According to a report by the Samsung Economic Research Institute (SERI) 
> Thursday, the Esteban & Ray (ER) index, which measures income inequality 
> between income brackets, was 0.0665 for Korea in 2004, higher than that 
> of most developed nations. The higher the index becomes, the wider the 
> income gap is between the haves and the have-nots.
> France's ER index came at 0.0434, followed by Germany with 0.0474, Japan 
> with 0.0507 and Britain with 0.0653. The United States was the only 
> developed country with a wider income disparity than South Korea with an 
> ER index was 0.0833, the report said.
> Also, the National Statistical Office (NSO) reported yesterday that the 
> bottom 20 percent in income suffered deficits in the first half of the 
> year as they spent more than they earned to cover rising living costs.
> The monthly income of the bottom 20 percent of households in the country 
> stood at about 800,000 won ($840) during the first six months of the 
> year. But they spent an average of 1.2 million per month, resulting in a 
> deficit of 400,000 won, up 10 percent from 360,000 won recorded in the 
> same period last year.
> However, the top 20 percent in income recorded a surplus of 1.9 million 
> won per month in the first half, up 4.9 percent from 1.8 million won 
> last year.
> The institute attributed Korea's growing income gap between the rich and 
> the poor to low economic growth since the 1997-1998 Asian financial 
> crisis *and the current administration's focus on redistribution of 
> wealth rather than economic expansion. */[emphasis added]/
> ``Even though the country's exports have expanded at a double-digit 
> figure over the past 10 years thanks to rising overseas demand, such an 
> increase has failed to encourage companies to expand corporate 
> investment and create high-paying jobs,'' it said.
> The institute said that is because Korea's exports have become more 
> centered on capital and technology-intensive industries, such as 
> semiconductors and cellular phones, creating fewer jobs compared to 
> traditional manufacturing businesses.
> ``To ease deepening economic polarization, the country should make the 
> utmost effort to enlarge its economic pie and create more jobs, 
> increasing the number of middle-class households, which have lately 
> fallen into the low-income bracket,'' it stressed.
> The institute also said the government should encourage companies to 
> expand facility and research-related investment and phase out 
> discriminative activities against non-regular workers to produce 
> high-quality jobs and stabilize the livelihoods of low-income households.
> leehs at koreatimes.co.kr 08-17-2006 17:48 

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