Academic journal article Development and Society

Three Dualization Processes in Korea: The Labor Market, Welfare Policy, and Political Representation

Academic journal article Development and Society

Three Dualization Processes in Korea: The Labor Market, Welfare Policy, and Political Representation

Article excerpt

Introduction

Observers both within and outside Korea agree that Korea's "formal democracy" is still confronted with staggering socioeconomic challenges, necessitating its more substantive democratization (Choi 2002, 2007). In other words, Korea's procedural democracy, which is the post-1987 legacy concentrated on the citizenry's political rights, is undermined by the ongoing social problems related to distributive justice (Morlino et al 2011, p. 505).

The suicide rate, heated competition, high poverty rate among the elderly, gender inequality, lowest happiness level for children of all OECD countries, and limited support for disabled people all indicate a worsening quality of life in Korea (OECD 2011, 2014). Income inequality has been increasing since the 1997 Asian financial crisis, with the Gini coefficient rising above 0.34 (2011). The relative poverty rate has also steadily risen and is now higher (15%) than in most OECD countries (Cheon et al. 2013).

According to the Bertelsmann Transformation Index,1 South Korea's democracy status score declined by 0.30 points from 2006 to 2014. Two criteria have a shown a particular decline, with Korea now scoring only -0.8 in political and social integration and -0.5 in political participation. As for the socioeconomic level, the rising share of irregular jobs with comparatively low salaries, a lack of job security, and weak labor union organization are a recent worrying trend. In terms of political and social integration, business is well represented with networks and interest groups, while labor unions are much weaker. In addition, the welfare system is generally under-developed and remains segmented.

Therefore, Korean citizens are not satisfied with the government's socioeconomic policy. In 2011, when asked whether they agreed or disagreed with the statement "Rich and poor people are treated equally by the government," only a small minority (19 %) marked either "strongly agree" or "agree." In view of the growing economic inequality and the polarization of wealth, only one in five perceived little discrimination based on economic status (Park 2014, p. 45).

Within this context, huge bodies of academic literature and political discourses have focused on the issue of "economic democratization," many authors believing it could resolve issues related to the limits of political democratization (Wee 2012; Kim 2012; Shin 2007). Further, a growing number of welfare regime studies2 are also examining the socio-economic conditions of Korean society and analyzing the development of the Korean welfare system. But it seems that existing discussions have not been able to reach a consensus on which types of welfare regime fit the Korean case. This is partly because existing explanations lack a clear understanding of the structural drivers of recent changes and comprehensive institutional dynamics.

The first aim of this research is to analyze the recent socio-economic development of Korea through the prism of the "dualization" process. Following the theoretical perspective of the Varieties of Capitalism approach (Hall and Soskice 2001), Thelen (2012, 2014) and Rueda (2007, 2014, 2015) have provided the new framework of "dualization," which explains structural causes and the different mechanisms of change. Even though the degree of dualization varies across countries, workers in many of them are divided between protected "insiders" and unprotected "outsiders" (Rueda et al 2015, p. 89). If a dualized labor market is a worldwide phenomenon, then, what are the main features of the Korean case? This article will provide a comparative view of the dualization process and its Korean peculiarities.

Secondly, this paper tries to understand the institutional complementarity between different dimensions of the dualization process. It aims to examine the nature and trends of labor market changes, the development of the welfare state, and changes in the political representation in Korea as an interrelated process of dualization. …

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