• Asia-Pacific Journal of Business
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• v.10 no.4
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• pp.137-151
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• 2019

Using Korean Labor and Income Panel Study data, this paper estimates nominal wage rigidity in Korea by industry from 2005 to 2017 and evaluates the level of inefficiency of Korean labor market. And, after estimating employment volatility by industry using the Labor Force Survey at Establishments data for Korea, we combine the nominal wage rigidity and the employment volatility estimates and analyze the effect of nominal wage rigidity on employment volatility in Korea from 2011 to 2017. If the level of wage rigidity is high, it may be hard for the labor market to be in the equilibrium, and therefore, the market may have inefficiency. We find that the inefficiency of the labor market in Korea have increased from 2005 to 2017 and the industry of accommodation and food service activities has the highest level of inefficiency over the period. We also find that one-percent-point increase in wage rigidity increases employment volatility by 2.3-2.9 percent and the positive effect is bigger for workers with part-time and temporary jobs. The result implies that firms may adjust their labor costs by changing the number of casual workers, rather than permanent workers, when the labor market suffers from a high level of wage rigidity.

• East Asian Economic Review
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• v.21 no.2
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• pp.167-197
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• 2017

I build a small open economy (SOE) dynamic stochastic general equilibrium (DSGE) model to investigate the effect of a heterogeneous wage contract between regular and temporary workers on a macroeconomic volatility in a financially fragile economy. The imperfect financial market condition is captured by a quadratic financial adjustment cost for borrowing foreign assets, and the labor market friction is captured by a Nash bargaining process which is only available to the regular workers when they negotiate their wages with the firms while the temporary workers are given their wage which simply equals the marginal cost. As a result of impulse responsesto a domestic productivity shock, the higher elasticity of substitution between two types of workers and the lower weight on the regular workers in the firm's production process induce the higher volatilities in most variables. This is reasoned that the higher substitutability creates more volatile wage determination process while the lower share of the regular workers weakens their Nash bargaining power in the contract process.

• Journal of the Korea Academia-Industrial cooperation Society
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• v.21 no.1
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• pp.138-147
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• 2020

The construction field is one of the most representative job creation businesses, but it has been pointed out that the overall quality of the jobs is low because of the nature of the order-made production industry, such as unstable employment structure, aging workforce, etc.. Accordingly, the government plans to implement the "prevailing wage system" that guarantees a minimum wage for construction site workers. In reality, however, only a market wage could be used for a construction cost estimation because there was no standard for the prevailing wage. A comparative analysis of the prevailing wage and market wage was performed. This paper proposes a framework for estimating the reasonable prevailing wage in the construction industry. The results showed that the prevailing wage was estimated to be 4.7% lower than the market wage when the proposed framework is applied to the carpenters' case. This suggests that the proposed model could be used as an alternative for market wage considering the original purpose of the prevailing wage. This study will construct the basic data for scientific analysis on the wage, and finally, help estimate the reliable prevailing wage in the future.

• Journal of Convergence Society for SMB
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• v.3 no.1
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• pp.7-13
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• 2013

It will prove that with a more plausible specification of the relationship between income and the value of leisure, we can develop a more accurate model of the labor market without necessarily losing the primary merit of the received model. Moreover, with an improved understanding of labor market dynamic we can see that progressive era labor market legislation, designed to mitigate the effects of bargaining power inequality in low wage labor markets, was in fact based upon sensible economic foundations. The results of this study as follow; These low-wage dynamics present an example of a positive feedback system or "vicious circle" at work in the economy. With the revised labor supply schedule presented above, the market dynamic of the low wage sector push the wage away from the range that is consistent with a self-regulating market.

• Journal of the Economic Geographical Society of Korea
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• v.5 no.2
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• pp.187-207
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• 2002

This study investigates the wage determination process of regional labor markets in order to understand the regional dimension of labor market processes in Korean metropolitan cities. Since the financial crisis in late 1997, the interplay between labor market restructuring such as unemployment and skill polarization and income disparity has been shaped by the labor market process in the metropolitan cities. This is also closely related to the fact that both industrial restructuring and expanding information technologies in the metropolitan region have reshaped the labor demand structure and finally resulted in structural unemployment due to skill mismatch and spatial mismatch and wage inequality across different occupations. In addition, since wage determination process clearly has a regional dimension, wage determination and its influence on income profile in a certain regional labor market need to be understood by investigating its labor market characteristics including labor supply and demand structure, industrial changes, changing unemployment, etc. This is why labor market policy as a regional policy needs to be redefined and it can be much enhanced by geographical investigation on regional labor market.

• Journal of Labour Economics
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• v.32 no.2
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• pp.61-93
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• 2009

In this paper, we estimate the wage premium of English skills in the Korean labor market using Korean Labor and Income Panel Study(KLIPS) data. In a simple OLS model, we find that people with some English skills in terms of self evaluation or job requirement earn 30% more than those who do not have English skills. But in a small sample of relatively young people, higher English lest scores do not raise earnings. When we add SAT scores in the wage equation, there is no wage premium of English skills, and in the IV estimation, we find no "English premium". These results consistently imply that while there is a large wage premium of English skills in the Korean labor market, it reflects unobservable ability for the most part. Meanwhile some of the regression results favor human capital theory over screening theory as an explanation of the nature of the wage premium of English skills.

• Analyses & Alternatives
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• v.6 no.1
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• pp.35-68
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• 2022

In this paper we define wage premium of college hierarchy as a wage differential among college graduates from different universities within the same graduate cohort and estimate the wage premium of college hierarchy for the three different cohorts: namely, 1982, 1992, and 2002. We utilize a unique data set called Education-Labor Market Lifetime Path Survey, which contains education and labor market information about the three different college graduate cohorts. We find that the wage premium of college hierarchy changes over time for the same cohort. It tends to large right after graduation but decrease with labor market experience. When the test score at the time of college entrance controlled, the wage premium of college hierarchy mostly disappears for the 1992 cohort. But for the 2002 cohort it remains seven years after graduation. The difference in the wage premium of college hierarchy can be explained, at least partly, by the number of colleges, college enrollment ratio, and the relation between college hierarchy and the entrance test score.

• Korea Journal of Hospital Management
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• v.5 no.2
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• pp.40-58
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• 2000

Nurses are medical personnel, who play a key role in supporting patient care, so it is important to supply them adequately in balance with ever increasing medical demand. But there appears severe shortage of nurses in some hospitals because of their uneven distribution, especially in small sized-hospitals and rural-hospitals. As nationwide distorted distribution of nurses in Korea is just like what monopsony model(a kind of market structure model) tells us, it is attempted to explain this situation of nurse labor market in Korea on the basis of monopsony model and presented in this paper. Specifically, determinants of nurse wage and the level of their relative employment were examined, and monopsony impact on their wage and the level of relative employment controlling those determinants were studied. Major results of this study arc as follows. The most important determinant of nurse wage level in this study was the wage level of a local community where each hospital located Hospital owner's characteristics an educational function of each hospital were also important factors. With these factor controlled, it was found that monopsony power of each hospital was negativel associated with nurse wage level as expected. 1% increase in monopsony power of hospital(measured by Herfindah-Hirschman Index) reduced nurse wage by $5,674{\sim}19,19$ won(in Korean currency). With regard to the level of relative employment, the most important determinant wa the capacity for supplying nurses of the local community. Again, hospital owner characteristics and educational function of each hospital were also important. With these factors controlled, it was found that monopsony power of each hospital was negative associated with the number of nurses per bed, as expected. 1% increase in monopsony power of each hospital(again measured by Herfindah-Hirschman Index) reduced the number of nurses per 100 bed as much as $0.46{\sim}0.67$. In conclusion. structural factors of nurse labor market influence the instability of nurse labor supply in Korea. Further consideration for these market structural characteristics needed for policy making related to nurse resource allocation.

• Journal of Labour Economics
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• v.26 no.3
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• pp.77-114
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• 2003

Analyses of the special data sets constructed from the National Longitudinal Survey of Youth and the Panel Study of Income Dynamics reveal that, compared with an annual wage measure, survey week wages are significantly counter-cyclically biased due to selecting workers with strong labor market attachment. We also find that survey week wages are more counter-cyclically biased in high-wage industries than in low-wage industries, that is, inter-industry gaps of survey week wages are counter-cyclically biased. Unlike existing longitudinal studies, the current study concludes that real wages are much more procyclical in high-wage industries than in low-wage industries, which is attributed to our adoption of annual wages that is less subject to the selectivity bias. Our finding is consistent with the empirical regularity that real wages are much more procyclical for men than for women, as men are overrepresented in industries with greater real wage procyclicalities. Overall, current results do not support the predictions of segmented labor market theories for the cyclicality of real wages.

• Korean Journal of Social Welfare
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• v.59 no.4
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• pp.297-317
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• 2007

In this article, I want to demonstrate wage equality increases support for welfare expenditures while the wage equality depends on how labour market institutions are organized. In other words, this study tries to show that there can be institutional complementarity between inequality-reducing labour market institutions and generous social policy. In the first section, I develop a theoretical models which deal(1) how the inequality of income affects the political support for welfare expenditure(2) how the configurations of labour market institutions affect income inequality in the labour market. In the following section, this study tests the models with data on welfare spending, configurations of labour market institutions, and the inequality of wage and salaries in 14 welfare states from 1980 to 1995. Empirical analysis also provides support for key implications of the models. These models and empirical findings may show that the institutional complementarity stems from the interdependence of institutional influences on actors' decision-making. Moreover, this study suggests welfare policy are always considered with labour market institutions.