Is Korea Moving Toward the Welfare State?: An IECI Approach

Abstract

In this paper, it is attempted to see whether the recent increase in the actual social expenditure can be the one caused by the change in the policy stance of Korean government. IECI is calculated to check this. The initial finding is that the IECI of the welfare expenditure shows the clear increasing trend. Moreover, IECI's after 2000 are greater than 100 meaning that the welfare expenditure in Korea now is far greater than the level expected under the international (OECD) standard, currently. It is a remarkable change considering the fact that IECI's before 1997 were less than 90. Thus, it shows that there is a fundamental change in the government policy toward the welfare. In this paper, it is argued that this is a sign of the policy change toward the European welfare state, although Korea is not the one yet. This also poses a serious problem in the future because the increase in the welfare expenditure is inevitable.