Internal labor markets and the effects of structural change: Job mobility in Korean labor markets between 1998 and 2000

Abstract

This study examines job mobility in Korean labor markets since the 1997 economic crisis. The rising job mobility in Korea is analyzed by focusing on structural change in labor markets. Using the Korean Labor and Income Panel Study and discrete-time event history analysis, I estimate the job-stabilizing effects of internal labor markets and the effects of structural change on job mobility. The major findings are as follows: First, I found that internal labor markets were weakening between 1998 and 2000. Second, the job-stabilizing effects of internal labor markets on job mobility diminished between 1998 and 2000. Finally, the magnitude of the effects of internal labor markets on job mobility was contingent on the level of structural change. The effect of internal labor markets on job mobility was stronger in turbulent or contracting industries. This effect, however, also became weaker over time. The implications for Korean labor markets are discussed.