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Labour market dualisation and social protection in South Korea: searching for a new social contract and growth model

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  • Fleckenstein, Timo
  • Lee, Soohyun Christine

Abstract

There is little doubt that South Korea needs to develop a new social contract as a matter of urgency. Labour market dualisation and the rise of insecurity have undermined the social fabric of the country in the absence of robust social protection mechanisms that could mitigate job insecurity and corresponding anxiety. Elected on a platform of economic and social justice, the centre-left Moon Jae-in government (2017–2022) started with an ambitious agenda of labour market and unemployment protection reforms, informed by an aspiration to establish an inclusive/wage-led growth model instead of the country’s divisive export-oriented growth strategy, which relies on the exploitation of irregular workers for its economic success. We assess labour market dualisation and recent reform by the Moon Jae-in administration, before considering alternative policy recommendations to address the social polarisation in Korean society.

Suggested Citation

  • Fleckenstein, Timo & Lee, Soohyun Christine, 2024. "Labour market dualisation and social protection in South Korea: searching for a new social contract and growth model," LSE Research Online Documents on Economics 122215, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:122215
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    File URL: http://eprints.lse.ac.uk/122215/
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    References listed on IDEAS

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    1. Birdsall, Nancy & Ross, David & Sabot, Richard, 1995. "Inequality and Growth Reconsidered: Lessons from East Asia," The World Bank Economic Review, World Bank, vol. 9(3), pages 477-508, September.
    2. Ringen, Stein & Kwon, Huck-ju & Yi, Ilcheong & Kim, Taekyoon & Lee, Jooha, 2011. "The Korean State and Social Policy: How South Korea Lifted Itself from Poverty and Dictatorship to Affluence and Democracy," OUP Catalogue, Oxford University Press, number 9780199734351.
    3. Fleckenstein, Timo & Lee, Soohyun Christine & Mohun Himmelweit, Sam, 2023. "Labour market dualization, permanent insecurity and fertility: the case of ultra-low fertility in South Korea," LSE Research Online Documents on Economics 117935, London School of Economics and Political Science, LSE Library.
    4. repec:ehl:lserod:115909 is not listed on IDEAS
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    More about this item

    Keywords

    South Korea; labour market dualisation; social protection; social contract; minimum wage; inclusive growth;
    All these keywords.

    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General

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