본문

KDI연구

KDI연구원들이 각 분야의 전문보고서를 제공합니다.

국토인프라

Working Paper

Widening Urban-Rural Income Differentials in Korea : A Re-Examination

페이스북
커버이미지
  • 저자 주학중(朱鶴中)
  • 발행일 1982/08/01
  • 시리즈 번호 8205
원문보기
요약 The long-prevailing notion of winding urban-rural income
differentials in Korea seems to be based on evidence that has
number of conceptual and empirical problems. However, without
carefully examining the comparability of the surveyed incomes of
the city wage earners` and farm households, the farm household
income was further adjusted downward, allowing for the
sampling bias and the capital gains from farm inventories. Such
adjustments have resulted in further evidence of accentuated
urban-rural income differentials during the past two decades of
rapid growth.

If the concept of income is used in distributive studies as a
proxy to represent the level of living and welfare, a direct
comparison of the income before tax is quite inadequate. It needs
to be adjusted for the urban-rural differences in cost-of-living,
in family size, an adult equivalent scale, rather than the
conventional equal weight, should be employed.

The income and price data used for this purpose lack
comparativeness in a number of ways. The farm household
survey sample is somewhat upward biased because of the
exclusion of the agricultural laborer households and farm
households with very small landholdings, and because of the
over-representation of farm households with large landholdings.
On the other hand, the city wage earners` household survey is
somewhat downward biased due to the imposition of a maximum
income ceiling which was intermittently adjusted until 1976.

However, little notice is given to fact that the city
household survey has upward bias due to a higher representation
of high-paying job categories and lower proportions of
unemployed and underemployed. Adjusting for the sample bias of
the farm household survey without doing the same for the city
household survey is inconsistent. The adjustment on capital
gains from farm inventories is found to be an oversight by a
foreign observers, which was accepted indiscriminantly by the
domestic followers without rigorous examination of its
implications. Another omission of the farm household survey is
imputed income from house ownership and rentals, which is
included in the city wage earners` income. The use of a deflator
in deriving farm incomes in constant prices also requires
scrutiny to determine its validity in terms of the relative weights
given to expenditure categories, and the numbers of items
surveyed.

Because of these theoretical and empirical problems involved
in the conventional comparison of the city wage reexamined in
terms of effective level of living. The adjustments were made
for cost-of-living differentials, family size, the direct tax and
levey burdens and the omission of income from house
ownership. Due to the lack of theoretical consensus in the
adjustment procedures and existing data constraints, the adjusted
effective level of living incomes are not the best, but
second-best approximations were adequate to bring the income
concept closer to what was is intended at the outset.

In terms of disposable effective level of living income, there
seems to be no visible trends of widening income differentials
between the two types of households, except for noticeable
income gaps during the period of 1967 to 1970. Some of the
erratic fluctuations in the income rations of the two are
attributable primarily to harvest conditions and intermittent
changes in the income ceiling imposed. Contrary to the evidence
presented by a number of agricultural economists, farm
households enjoyed higher levels of disposable effective level of
living incomes than the city households throughout the 1970`s.

What is more significant is that in the reference year 1976
the effective level of living incomes of relatively lower income
classes among farm households increased much more than
higher farm household income brackets as well as the
corresponding income classes among city households. In addition,
a higher proportion of farm, households is concentrated in the
middle income brackets than their city counterparts. In light of
these evidences, the arguments for widening urban-rural income
differentials Korea is found untenable.

Finally, two implications from this study deserve mentioning.
First, the core of the distributive problems is not inter-sectoral,
but intra-sectoral inequality. The inter-sectoral income
comparison by average defies the notion of dispersion or
distribution. In a rapidly industrializing country like Korea, center
of gravity of the economy shifts to the non-agricultural sector
as rapidly as its pace of industrialization. The growing
inequalities within urban households and among the
self-employed must be recognized as a higher priority policy
issue than the inequality between city and farm households in a
nation, considering that only about a quarter of the population is
in the agricultural sector and this percentage is expected to
decrease even further in the near future.

Second, there is an unfortunate tendency among analysists
to be careless with the data and statistics used for given
analytical purpose, especially in developing countries. Without
meticulous evaluation of the available basic data and statistics,
the inherent biases and limitation can distort the positivism of
the empirical analysis. Irresponsible use of existing imperfect and
biased statistics should be cautioned against and should in no
way be excused by shifting responsibility to the producers of
statistics. Analysists must account for imperfect statistics when
drawing their conclusions.
같은 주제 자료 이 내용과 같은 주제를 다루고 있는 자료입니다.

※문의사항 미디어운영팀 윤정애 전문연구원 044-550-4450 yoon0511@kdi.re.kr

가입하신 이동통신사의 요금제에 따라
데이터 요금이 과다하게 부가될 수 있습니다.

파일을 다운로드하시겠습니까?
KDI 연구 카테고리
상세검색