• The Journal of Industrial Distribution & Business
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• v.13 no.12
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• pp.33-39
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• 2022

Purpose: This research investigates the paths of some important economic variables: government domestic product (GDP), capital accumulation, unemployment rates. Decreasing GDP, declining capital accumulation and higher unemployment affect to South Korea economy. The macroeconomic policies discussed are all capital financed accumulation policy and an enactment of unemployment regulation. Research design, data and methodology: The GDP, capital accumulation rates and unemployment rates are the main macroeconomic issues in the South Korea. This research studies the correlations of the GDP, capital accumulation, and unemployment rates by time series data from 2000 to 2005 in a Vector Autoregressive (VAR). Results: The first, GDP relates a positive effect between the GDP and capital accumulation in the long term. The second, there is the negative relationship between GDP and unemployment rates. Economic growth was strongly supported by employment growth and by declining unemployment. The third, There is positive relationship between unemployment rates and capital accumulation. Conclusions: This research provides that fiscal policy introduce to increasing GDP, private investments and employment rates. The GDP should be major on capital accumulation to increase employment rates in South Korea.

• Korean Journal of Social Welfare
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• v.45
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• pp.7-39
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• 2001

This paper examines the effect of active labor market policy on the unemployment rates in 8 welfare states. This paper focuses on the following questions: what are the major predictors of the changes in unemployment rates?; and what is the effect of active labor market policy in reducing unemployment rates? Using the data from Comparative Welfare States Data Set by Stephens (1997), Key Indicators of the Labour Market by ILO (1999) and Social Expenditure Database by OECD (1999), this paper attempts to answer the above research questions. Fuller-Battese model, a data analysis method in pooled cross-sectional time-series analysis, is adopted to identify variables predicting changes in unemployment rates. This paper analyzes the predictors by using 3 analysis models about 2 types of unemployment (overall unemployment and long term unemployment). Results are as follows: (1) economic variable such as changes in GDP has a positive effect in reducing unemployment rates; (2) active labor market policy has a positive effect in reducing unemployment rates as well; (3) job brokering service among 3 major active labor market programs has a positive effect in reducing unemployment rates; and (4) there is an interaction effect between unemployment benefit level and active labor market policy in reducing unemployment rates. Through the empirical analysis, this paper provides valuable knowledge about effects of active labor market policy on unemployment in 8 welfare states and discusses implications for the active labor market policy in Korea.

• Journal of Preventive Medicine and Public Health
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• v.36 no.1
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• pp.85-91
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• 2003

Objectives : We investigated the effects of the economic growth and unemployment rates on the suicide rate in Korea, between 1983 and 2000, using a time-series regression model. The purpose of this study was to model and test the magnitude of the rate of suicide, with the Korean unemployment rate and GDP. Methods : Using suicide rate per 100,000 Koreans and the unemployment rates between 1983 and 2000, as published by the Korea National Statistical Office, and the rate of fluctuation of the Korean GDP (Gross Domestic Product), as provided by the Bank of Korea, as an index of the economic growth rate, a time-series regression analysis, with a first-order autoregressive regression model, was peformed. Results : An 81.5% of the variability in the suicide rate was explained by GDP, and 82.6% Of that was explained by the unemployment rate. It was also observed that the GDP negatively correlated with the suicide rate, while the unemployment and suicide rates were positively correlated. For subjects aged over 20, both the GDP and unemployment rate were found to be a significant factors in explaining suicide rates, with coefficients of determination of 86.5 and 87.9%, respectively. For subjects aged under 20, however, only the GDP was found to be a significant factor in explaning suicide rates (the coefficient of determination is 38.4%). Conclusion : It was found that the suicide rate was closely related to the National's economic status of Korea, which is similar to the results found in studies in other countries. We expected, therefore, that this study could be used as the basis for further suicide-related studies.

• Korean Journal of Social Welfare
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• v.63 no.3
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• pp.187-211
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• 2011

This study examines the effects of active labor market policy on unemployment by pooled cross-section time series analysis utilizing panel data of 18 OECD countries, and seeks implications for improvements of the Korean active labor market policy. The results of the analysis are summarized as follows. First, active labor market policy negatively affects unemployment rates. Second, vacational training program among three major active labor market programs has a negative effect on unemployment rates. Third, employment service program and employment subsidy program have partially negative effects on unemployment rates. The implications for the Korean active labor market policy are as follows. First, it is necessary to expand and systematize active labor market policies. Second, vocational training programs should be systematized and professionalized according to labor demand. Third, employment subsidy programs need to be planned and carried out under the condition of minimizing a substitution effect, a displacement effect and a deadweight loss effect. Fourth, employment service programs need to be developed and carried out under the consideration of not only the reduction of unemployment rates but also the prevention of re-unemployment, mitigation of income inequality and improvement of productivity.

• The Journal of Asian Finance, Economics and Business
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• v.6 no.2
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• pp.269-275
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• 2019

This study intended to examine the relationship between inflation and unemployment rate in Indonesia during 1987 to 2018 period. The study applied a quantitative method using Vector Error Correction Model (VECM) in order to comprehensively understand the causality between inflation and unemployment rates. The data were collected from various main sources including the World Bank, Central Bank of Indonesia, and Central Bureau of Statistics (BPS). The findings showed that inflation has a one-way relationship toward unemployment in Indonesia and it occurs at the third lag. Impulse Response Function (IRF), shows that the inflation rate are fluctuating in response to the shock of unemployment. The unemployment rate responses to shocks from inflation initially increased until it is eventually diminished. It shows that the shocks caused by the impact of inflation were only in the short term. Further, inflation in the three previous lags will have consequences for the unemployment rate in the year. Lastly, both in the long run and short run, unemployment did not affect inflation rates. These findings suggest that high inflation in Indonesia is determined the rising price of basic commodities and fuel. In addition, most companies in Indonesia applying capital intensive so that employment growth in Indonesia is small.

• KDI Journal of Economic Policy
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• v.40 no.3
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• pp.1-44
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• 2018

This paper studies the macroeconomic effects of an enhancement in unemployment benefits in Korea. In particular, I quantify the welfare effect of two specific policy chances which have been mainly discussed among policymakers in recent years: increasing wage replacement rates by 10%p and extending maximum benefit durations by one month. To this end, I build and calibrate an overlapping generation model which reflects the heterogeneity of the unemployed and the specificity of the unemployment insurance (UI) system in Korea. The quantitative analysis conducted here shows that extending maximum benefit durations by one month improves social welfare, whereas increasing wage replacement rates by 10%p deteriorates social welfare. Extending maximum benefit durations is applied to potentially all the UI recipients, including unemployed workers whose wage before job loss is relatively low and whose marginal utility is relatively high. However, increasing wage replacement rates is applied to only a small number of UI recipients whose wage before job loss is relatively high, while the increase in the UI premium is passed onto all of the employed. This study suggests that given the current UI system and economic environment in Korea, it is more desirable to extend maximum benefit durations rather than to increase wage replacement rates in terms of social welfare.

• The Journal of Industrial Distribution & Business
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• v.9 no.3
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• pp.19-29
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• 2018

Purpose - This study empirically analyses the changes in unemployment rates to understand push factors of generating wage pressure and how it affects the aggregate demand in Korea and the United States. We use a structural macroeconomic model which is centered on the labor market and simultaneously explains the natural rate of unemployment and deviations. Research design, data and methodology - We attempt to empirically analyse the unemployment rates through two countries to analyse the economic effects of real wages and aggregate demand between 2000 and 2016. We introduce having estimated the whole model that the growth of unemployment into the part caused by each of these factors. Results - The results of this study show that in the long run, there is not only a natural level of employment but also a natural level of real demand are positively related. in the short run, demand can vary from bring about changes in employment by means of price or wage surprises. Conclusions - The pressure of demand in the labor market shows up strongly in both countries. The estimated labor-demand equation are consistent with this framework and generally have well defined real wage and demand effects.

• Journal of Labour Economics
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• v.38 no.2
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• pp.1-24
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• 2015

We estimate the natural rate of Unemployment in Korea, using job finding and separation rates. The estimation results suggest that both job finding and separation rates of Korea have increased after the 1997 Asian Financial Crisis. However, we don't find evidence of significant increase in the trend of the natural rate of unemployment. Overall our finding suggests that both job creation and destruction have increased.

• Korean Journal of Social Welfare
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• v.36
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• pp.229-257
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• 1998

In order to evaluate the effects of high unemployment rates on the income distribution and to find out mediative factors to these effect, the relationship between unemployment and income inequality in the industrialized countries and determinants of their relationship are analysized in this paper. Major findings from the analysis are these. First, changing pattern of unemployment rates are not similiar that of income inequality in the industrialized countries. This result suggests that relationships between unemployment and income inequality are dissimiliar within the industrialized countries. Second, results from analysis about relevant factors' effect on the relationship between unemployment and income inequality, the effects of economic factors such as economic growth rates and the scale of economy are not significant. But variables such as union density rates and scale of social welfare expenditure are found to have significant effects on the relationship between unemployment and income inequality. In fact, when the policy factors enters, the negative distributional effects of unemployment are lower by 50%. These results impliy that dissmilarities between the industrialized countries in the 1980s' changing patterns of income inequality are engendered from the union density rates and scale of social welfare expenditure. These findings in this paper suggest such a implication to the Korea; In order to achieve the more deserable society, policy orientations which give the priority to the economy restructuring rather than development of social welfare have to be reexamined and modified.

• KDI Journal of Economic Policy
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• v.39 no.4
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• pp.69-94
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• 2017

This paper re-examines the impacts an institutional arrangement may have on labour market outcomes such as the employment and unemployment rates. Based on the results from a generalized econometric model, the generosity of unemployment insurance benefits, organized labour and active labour market policy have effects on a labour market in line with previous findings. However, taxes on labour and the degree of employment protection are found to affect neither the employment rate nor the unemployment rate. Thus, some findings in this paper validate earlier findings, whereas others do not.