Heterogeneity and Gross Worker Flows / WEH-SOL MOON

This paper extends the three-state model of labor supply and worker flows developed by Krusell, Mukoyama, Rogerson and ahin (American Economic Review, 2017) to study dynamic individual behavior by allowing for ex-ante heterogeneity in workers’ abilities in the market and in their valuation of non-market time. The extended model replicates the key features of the distributions of personal employment rates, OLF rates, and residual wages found in the SIPP data. Individuals with relatively high rents from being employed are more likely to stay in the labor force by cycling back and forth between employment and unemployment from month to month. Individuals with relatively low rents from employment transition between employment and OLF.


Decomposing the Growth of Part-time Work in South Korea, 2010-2024 / SU HWAN CHUNG

This paper examines the factors contributing to the growth of part-time work in South Korea from 2010 to 2024, during which the fraction of part-time workers doubled. A decomposition analysis suggests that changes in the workforce composition account for approximately 30 percent of this growth, primarily driven by workforce aging. However, the explanatory power drops to around 10 percent when excluding workers likely to participate in a government program providing parttime jobs for older workers. This limited explanatory power is attributed to substantial within-group increases and a declining fraction of young workers, partially offsetting the expansion of older workers. These findings suggest that further research is needed to investigate factors beyond compositional changes to explain the recent growth of part-time work in South Korea.


Heterogeneous Impacts of the U.S.-China Trade War on Korea: What Drives Industry Differences? / HEEHYUN LIM

This paper analyzes how the U.S.China trade war affected Korean industries and identifies the industry characteristics that determined which industries gained or lost. I show that heterogeneity in responses is closely linked to capital intensity and export intensity, highlighting the role of economies of scale and export readiness. Using detailed industry-level data from Korean manufacturing, the analysis finds that capital-intensive industries with substantial pre-war investments and industries with high export intensity achieved greater growth and cost reductions following the tariff shocks. These findings indicate that industries positioned to expand their scale captured the gains, while others were left behind, emphasizing the importance of targeted and differentiated policy support for pre-investment, capital deepening, and export infrastructure ultimately to enable more industries to leverage external trade disruptions as opportunities for sustained growth.


Effects of Weather Conditions on Price in Korea / Seunghee Lee

This paper examines the effects of unexpected changes in weather conditions on inflation in Korea. Using a structural vector autoregression (SVAR) model, we analyze how changes in temperature and precipitation influence price dynamics across different components of the consumer price index (CPI). Our empirical analysis reveals that unexpected changes in weather indices induce significant volatility in fresh food prices and exert direct impacts on consumer inflation, with precipitation changes contributing more substantially to short-term price increases than temperature variations. The effects are particularly pronounced during summer. However, core inflation, which excludes volatile food and energy components, remains largely unresponsive to weather indices. Through a regression analysis examining the interaction between headline and core inflation, we find that consumer prices tend to revert to core inflation levels, suggesting that weather-induced price fluctuations have limited medium-term impacts on the underlying inflation trend. These findings indicate that while weather changes may increase short-term price volatility through agricultural supply disruptions, monetary policy responses to such temporary fluctuations may be ineffective. Accordingly, alternative policy measures focusing on supply diversification and climate resilience should be prioritized.