The Korean Economic Review
Effects of Initial Labor Market Conditions on Job Polarization: Evidence from South Korea
Youngsoon Kwon (Yonsei University), Myungkyu Shim (Yonsei University) and Hee-Seung Yang (Yonsei University)Year 2024Vol. 40No. 2
This paper investigates the extent to which initial conditions in the labor market influence the progress of job polarization in Korea. In particular, we compare the following two competing hypotheses: a specialization hypothesis and an inter-industry wage differentials hypothesis. Our findings indicate that job polarization is pronounced in industries that have historically relied on routine tasks and have experienced a significant increase in ICT capital intensity between 2000 and 2019. By contrast, initial inter-industry wage differentials are not associated with job polarization in Korea during the same period.