The Korean Journal of Economic Studies
A Study on the Age Effects and the Cohort Effects of Income Distribution in Korea
Jong In Yoon (Baekseok University)Year 2018Vol. 66No. 1
We investigate the age effects and the cohort effects of income distributionin Korea during 1990~2015. Our main results are as follows. First, we obtaina secular rise of inequality based on the before-tax income but a moderate riseof that based on after-tax income. These results mean that the governmentpolicy has been effective. Second, age-income level effects, age-incomedistribution effects, and cohort-income level effects are likely to be significantbut cohort-income distribution effect is not. Third, Theil index decompositionsby age show that between-age group effects have grown faster than within-agegroup effects. Recently, between-age group effects contribute to the overallincome distribution more than within-age group effects. We can obtainmeaningful implications about explaining the past movement of incomedistribution and predicting inequality of younger generations and older ones inthe future.