KDI - Korea Development Institute - RESEARCH - Research Areas

Summary

Research Monograph KOR Redesigning Safety Nets as a Response to New Challenges

The safety net faces new challenges. Non-regular workers are increasing with diversifying forms of employment, but the current safety net does not protect these new types of workers. The COVID-19 crisis highlights the lack of protection for these workers in our existing safety net. Also, the transition to a digital and eco-friendly economy is expected to trigger drastic changes in jobs and put burdens on the most vulnerable workers, which requires strengthening the safety net.

This study examines the limitations of the current safety net in rapidly changing economic and social conditions and provides ways to restructure it in response to new challenges. This study consists of four chapters: income support system, employment safety net, adult education and training, and safety net for sick workers. These four fields have revealed major problems in the COVID-19 crisis and need to be addressed and strengthened to build a comprehensive safety net.

Chapter 1 examines the effectiveness of the income support system during the COVID-19 period and provides an overall evaluation of the system in terms of inclusiveness, poverty reduction, economic responsiveness, and consistency. Chapter 2 analyzes what causes blind spots in the employment safety net and estimates a structural model, including unemployment insurance for the self-employed and unemployment assistance, to suggest policies for a comprehensive employment safety net. Chapter 3 investigates the characteristics of users and non-users of adult education and training voucher programs and examines why the most vulnerable groups in need of the programs do not use vouchers. Chapter 4 analyzes the state of the safety net supporting sick workers and examines the impact of health shock on employment and income to provide implications for the design of sickness benefits.

These four chapters share a common concern about the safety net's wide blind spots, especially for vulnerable workers, and discuss policy tasks. First, the employment safety net does not provide protection for temporary, non-regular workers and the self-employed due to limited unemployment insurance coverage. Also, income support programs for the working-age group are not responsive to economic needs, and support against economic difficulties is insufficient. This study suggests strengthening unemployment assistance for the low-income and vulnerable workers to enhance the inclusiveness and economic responsiveness of the safety net. Second, although anyone can participate in adult education and training institutionally, the actual participation rate of the vulnerable is low. This study points out that it is important to induce their actual participation, not simply an external expansion. Third, insecure workers are less likely to access sick leaves than secure workers. Due to the disparity across workers, sickness benefits under discussion for adoption may also have practical blind spots for vulnerable workers. This study discusses policies that need consideration when designing sickness benefits to provide a secure safety net for sick workers.

Summary

Research Monograph KOR Educational Reform through Project-based Learning (PBL)

This Project-based learning (PBL) is gaining increasing prominence as an educational pedagogy for enhancing students’ key future competences - communication, collaboration, critical thinking and creativity, referred to as the 4Cs. However, according to the Teaching and Learning International Survey (TALIS) 2013 report, the proportion of PBL classes in Korean middle schools is the lowest among 31 countries being surveyed (mainly OECD countries). Moreover, the lowest proportion of PBL classes in Korea can explain much of the fact that teacher self-efficacy and student life satisfaction in Korea are very low compared to other OECD countries.

We in partnership with Daegu Metropolitan Office of Education, assisted two middle schools (treatment group) in implementing PBL programs during the second semester of 2015. Then, we use a differences-in-differences analysis to measure the changes in students’ communication and collaboration skills compared to those of their counterparts in three neighboring schools within as 2 km radius (control group) over the same period. The baseline survey for 678 students of 7th grade among 5 middle schools was conducted in the beginning of the second semester of 2015 (August 24th-28th) and we re-surveyed 98.2% students (666 students) at the end of the semester (December 21st-24th).

Due to the difficulties in measuring communication and collaboration skills, we used standard methods on network and behavioral economics in order to correctly gauge each skill. For communication skill, students were asked to list their three best classmates. With this friendship network information in the classroom, we mainly analyze the following four statistics: 1) the proportion of those who were not chosen as a friend, 2) the probability that friendship is mutual between myself and my friend, 3) the number of subgroups who are separated from their peers, 4) the average path length of how many friends, on average, have to be connected for one to be a friend of another. As for collaboration skill, we use the dictator game and the public goods game in order to measure students’ way of caring for and collaborating with others to handle the situation in which their personal interests were in conflict with the interests of the entire class or another classmate.

We find positive impact of PBL program on some of communication skill dimensions despite the fact that the intervention period of this study is relatively short (one semester). For collaboration skill, the treatment group invested 8%p more in the public goods game than the control group whereas no significant difference was observed in the dictator game. One-semester PBL program was not enough to enhance students’ unconditional altruism (measured by the dictator game) but did improve the level of mutual trust and collaboration for the common good (measured by the public goods game). Meanwhile, there were no significant negative effects on academic performance on Korean, Math, English, and Science.

Summary

Policy Study KOR A Study on the Causes of Long-Term Unemployment, Effect of Vocational Training and Schemes to mprove Vocational Training

This study examines the possible role of vocational training as an effective policy response to long-term employment, and explores the causal impact of vocational training and schemes to improve it. Using Economically Active Population Survey, we find that the duration of the unemployment have become longer since 2000. Examining the cause of the long-term unemployment hints that, the vocational training could serve as effective measure for reducing the average duration of unemployment. Despite positive impacts vocational training might have on unemployment, the effectiveness of current vocation training in Korea is rather disappointing. In particular, using Employment Insurance DB, we fail to find the supportive evidence that the vocational training increases the chance of employment of trainees. The lack of effectiveness of vocational training is partly due to the short-term and cheap training courses. This study suggests that the provision of programs with sufficient training time and costs meeting high quality is crucial for the effectiveness of the vocational training programs.

Summary

Policy Study KOR Analysis on Youth Unemployment and Policy Implication

One of the problems of the labor market in Korea since the financial crisis is the job-seeking difficulties of the youth and the rise in the number of the unemployed youth. In order to tackle this problem, the government has implemented extensive all-out plans but with no satisfactory results. The recent employment condition casted a shadow over the outlook for youth employment, and the government’s active and effective measures are highly required now.

This study investigates the status of youth unemployment, analyzes the cause, and at the same time seeks for effective policies to tackle this problem. As many researches have pointed out, the worsening employment conditions are attributable to the difference between the expectation of job seekers, such as excessive education (over qualification) backgrounds and the preference for stabilized workplace, or to the changes in the recruiting pattern of companies, such as the changes in industrial organization and the preference for workers with experience rather than inexperienced workers. As the effort to explain the causes of youth unemployment in the framework of labor supply and demand has revealed its limitations, there is a need to highlight the importance to study the recent job mismatch. Despite such need to analyze the job mismatch from the economic perspective, there have been no sufficient empirical analyses, thus far. In this regard, this study, faithfully based on the theory of job mismatch, suggests the results of its empirical analysis and then concludes with the policy direction based on the analysis results.

The results of this study can be briefly summarized as follows: The elasticity of employment with respect to the job offer probability turned out high, while that with respect to the implicit opportunity cost caused by unemployment turned out low. This means that the policy to improve the youth unemployment rate needs to focus on labor demand, rather than labor supply. Under this context, various policies and measures that have been implemented in the past to tackle youth unemployment are con-side red unsatisfactory. Therefore, future policies to enhance youth employment should include active job placement, active operation of workplace experience programs promoted by the private sector, extensive measures and systematic management for the unemployed youth, and reinforced policy promotion.

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