Public-Private Pay Comparability: The Korean Experience

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Public-Private Pay Comparability: The Korean Experience

Although many governments subscribe to the principle of public-private pay comparability in law and policy pronouncements, few adhere to the concept in actual practice. This article examines the policy of pay comparability in the Republic of Korea. Ecological variables to include unionization, economic conditions and policy, labor force supply and job opportunity, and social perceptions of public employment are explored to explain the weak implementation of public-private pay comparability on the part of the Korean government.

The principle of public-private pay comparability has been a central issue in the study of public personnel administration. However, there are few propositions which might help explain why differences exist between nations on the salaries paid to public and private workers. This article examines the issue of pay comparability between public and private sector workers in the Republic of Korea. We analyze the extent to which public private pay comparability has been achieved and explore ecological factors which may help explain incongruities in pay policy output. By examining a rapidly modernizing nation such as Korea, it is the intent of the authors to generate propositions which may be tested on a broader sample of nations in order to move toward a more comprehensive theory of pay comparability.

Theoretical Perspectives

Two theoretical foci relate to this topic: the ecological-systemic perspective in comparative public administration, and the principle of public-private pay comparability in personnel administration.

Easton's input-output model and Gaus-Riggs' ecological approach emphasize the interaction between the public sector and the environment, and the separate influence of environmental and cultural factors as major determinants of governmental performance (Easton, 1953; Gaus, 1947; Riggs, 1971; Al-Salem, 1977; Peretz, 1978). According to recent literature on comparative policy, typology studies (e.g., classifications of political and bureaucratic systems of nations) are limited because of difficulties in generalizing the nature of each policy-setting (e.g., countries, governments) regardless of specific situations, time, and cases (Ashford, 1978: 12-3; Kelly, 1978). Rather, a comparative study should focus concern on the broader contexts or environmental conditions bearing upon the adoption of certain policy and its consequences. Through such a study, empirical information can be gathered and lead to a better understanding of policymaking and administrative practices across nations (Teune, 1978; Kelly, 1978).

The principle of public-private pay comparability, as a decision criterion in policy and as a measure of comparison for policy performance, encourages governments to pay salaries and benefits comparable to those of private employees performing similar work. This is a part of the principle of "equal pay for equal work" and has been regarded as a common rule--reflecting a blend of political and economic considerations," such as citizens' tax burden, relative attractiveness of employment, public workers' support and election of political officials, and the size and role of government (Stahl, 1976: 94-9; Fogel & Lewin, 1974; Nigro & Nigro, 1976: 125). The political and economic rationale of the principle is that pay comparability may be the only possible way to meet both equity and efficiency (Lewin, 1974; Fogel & Lewin, 1974; Park, 1984).

It has been asserted that if the level of public-sector pay is lower than that of private companies, it may appear inequitable to the general public and government workers. As the share of government employment is substantial, public employees and their family members' interests may influence the vote for political officials, interacting with union activity (Lewin, 1974; Davidson, 1980). Lower pay also may worsen the public workers' performance during the elected officials' terms of office. …