Poverty Conditions for the Rep. of Korea in the Aftermath of the Financial Crisis

by

Head Researcher: Kim, Dong-Choon

Associate Researchers: Rew, Jung-Soon, Jung, Gunh-Wha,

Jang, Se-Hoon, Huh, Sun, Noh Dae-Myung, Soan, Byung-Donn

People’s Solidarity for the Participatory Democracy(PSPD)

November 2000



Chapter 1. Introduction ………………………… 1

1. Background and Purposes ⊳ 1

2. Outline of the Report ⊳ 2

3. Data and Limitations ⊳ 3

Chapter 2. The National and Household Economy After The Foreign Exchange Crisis ………………………… 4

1. Major Economic Indicators ⊳ 4

2. Employment ⊳ 6

3. Household Economy ⊳ 8

Chapter 3. Distributional Structure ………………………… 12

1. Degree of Income Inequality ⊳ 12

1) GINI Index ⊳ 12

2) Income Gap among Different Income Groups ⊳ 13

3) Income Gap Among Age Groups ⊳ 17

2. Degree of Consumption Inequality ⊳ 17

1) Changes in expenditures GINI index ⊳ 17

2) Changes in Consumption Gap Among Income Groups ⊳ 18

3) Changes in differences Among Age Groups ⊳ 21

3. Characteristics of Income Groups ⊳ 22

1) Changes in Age of Household Heads ⊳ 22

2) Changes in Composition Rates of Household Heads with Different Levels of Education ⊳ 24

3) Changes in Size of Households and Number of

Employed ⊳ 25

4) Changes in Composition Rates According to Occupation

Groups ⊳ 26

5) Changes in Characteristics of Unemployed Households ⊳ 28

Chapter 4. Poverty Rate and Poor Households ………………………… 33

1. Estimating Methold of Poverty Rate ⊳ 33

1) Estimating Method of Absolute Poverty Line in 4-Person Households ⊳ 33

2) Household Equality Index ⊳ 34

3) Use of Consumption Expenditure as an Indicator of

Household Economic Power ⊳ 35

2. Poverty Rate ⊳ 36

1) Estimation of Minimum Cost of Living ⊳ 36

2) Poor Poverty Rate and Scope of Poverty Population ⊳ 37

3) Extreme Poverty Rate ⊳ 39

3. Living Conditions of Poor Households ⊳ 41

1) Total expenditures ⊳ 41

2) Essential expenditures ⊳ 42

3) Accessory expenditures ⊳ 45

Chapter 5. The Poverty-Stemming Effect of Unofficial Welfare Practice and Its Limits ………………………… 48

1. The Scale and Scope of Unofficial Welfare Practice ⊳ 49

2. The Poverty-Stemming Effect of Unoffical Welfare Practice

in Urban Working Households ⊳ 53

1) Poverty-Stemming Effect of private income transfer ⊳ 54

2) Poverty-Stemming Effect of Private Income Transfer According to Income Groups ⊳ 56

3. The Poverty-Stemming Effect of Unoffical Welfare Practice In Unemployed Households ⊳ 58

1) The Poverty-Stemming Effect of Private-Transfer Income ⊳ 58

2) Poverty-Stemming Effect of Private Income Transfer Among Income Groups ⊳ 60

4. Significance ⊳ 63

Chapter 6. Government Poverty Countermeasures ………………………… 63

1. Poverty Relief Measures For the Poor ⊳ 64

1) Changes in Budget ⊳ 64

2) Structural Changes ⊳ 65

2. Evaluation of the Governmental Poverty Countermeasures ⊳ 72

1) Poverty-Stemming Effects ⊳ 72

2) System Management ⊳ 75

3. Policy Improvement ⊳ 78

Chapter 7. Summary and Conclusions ………………………… 89

References ………………………… 92

PSPD


2000/11/01 00:00 2000/11/01 00:00

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