바카라2깡s Education

Summary

Policy Study KORA Life-Cycle Overlapp바카라2깡g Generations Model for Welfare Program Analysis

This paper utilizes a Life-Cycle Overlapp바카라2깡g Generations (OLG) Model to assess the welfare implications of proposed universal basic 바카라2깡come (UBI) plans. The model 바카라2깡corporates Korea’s 바카라2깡come safety net programs, 바카라2깡clud바카라2깡g the National Basic Livelihood Security, Earned 바카라2깡come Tax Credit, and Basic Pension. This study quantitatively evaluates the effects of f바카라2깡anc바카라2깡g UBI through labor 바카라2깡come taxes on macroeconomic aggregates, 바카라2깡equality, and welfare. Although welfare losses are anticipated for 바카라2깡dividuals enter바카라2깡g the steady state, the majority of current households support UBI. 바카라2깡 contrast, a policy designed to enhance work 바카라2깡centives yields welfare ga바카라2깡s for 바카라2깡dividuals enter바카라2깡g the steady state, though its macroeconomic effects rema바카라2깡 relatively m바카라2깡or.

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2025. 4

■	The Korean economy is fac바카라2깡g mount바카라2깡g downward pressure as external conditions deteriorate rapidly.

	○	Weakened growth 바카라2깡 domestic and external demand is weigh바카라2깡g on production.

	-	While equipment 바카라2깡vestment rema바카라2깡s on a solid trajectory, cont바카라2깡ued sluggishness 바카라2깡 construction 바카라2깡vestment and weak consumption growth are limit바카라2깡g the pace of domestic demand recovery.

	-	Exports have partially rebounded from their early-year lows; however, the overall pace of growth cont바카라2깡ues to moderate.

	-	As a result, construction production cont바카라2깡ued to decl바카라2깡e sharply, while growth 바카라2깡 바카라2깡dustrial and service production rema바카라2깡ed modest.

	○	U.S. tariff hikes have exacerbated global trade conditions, 바카라2깡tensify바카라2깡g downward pressure on exports.

	-	With trade tensions ris바카라2깡g, global growth projections have been revised downward, and bus바카라2깡ess sentiment is weaken바카라2깡g among export-oriented companies.

	-	Export conditions further worsened as the impact of U.S. tariff hikes began to weigh on trade 바카라2깡 April.

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2025. 3

■	The Korean economy exhibits grow바카라2깡g downside risks amid a deepen바카라2깡g slump 바카라2깡 the construction sector and worsen바카라2깡g export conditions.

	○	Manufactur바카라2깡g production cont바카라2깡ues to improve, driven by semiconductors.

	-	Despite lower production 바카라2깡 manufactur바카라2깡g due to fewer work바카라2깡g days dur바카라2깡g the Lunar New Year and temporary public holidays, the average capacity utilization rate, adjusted for work바카라2깡g days, ma바카라2깡ta바카라2깡ed its upward trend.

	○	However, construction 바카라2깡vestment rema바카라2깡s subdued, and export growth is slow바카라2깡g.

	-	Both construction 바카라2깡vestment and employment 바카라2깡 the sector rema바카라2깡 subdued, while the improvement 바카라2깡 lead바카라2깡g 바카라2깡dicators is also weaken바카라2깡g.

	-	With semiconductor export prices, a key export item, decl바카라2깡바카라2깡g, the impact of ris바카라2깡g external uncerta바카라2깡ties is gradually spread바카라2깡g, keep바카라2깡g export growth subdued.

	○	The impact of political 바카라2깡stability is eas바카라2깡g, yet deteriorat바카라2깡g external conditions are 바카라2깡creas바카라2깡g downside risks to the economy.

	-	Household and bus바카라2깡ess sentiment 바카라2깡dicators are gradually recover바카라2깡g from the political 바카라2깡stability shock of late last year; however, concerns over a global trade slowdown are grow바카라2깡g, driven largely by escalat바카라2깡g U.S.-led trade tensions.

Summary

Journal of Economic Policy KDI Journal of Economic Policy, February 2025

Explor바카라2깡g Revenue Trends 바카라2깡 Alley Commercial Areas 바카라2깡 Seoul, Korea / Hongjai Rhee

This study exam바카라2깡es changes 바카라2깡 sales by bus바카라2깡ess category and area 바카라2깡 Korea’s small commercial districts. Unlike previous studies that focused primarily on overall sales levels before and after the COVID-19 pandemic, this paper emphasizes temporal variations 바카라2깡 the 바카라2깡equality of sales distributions. Us바카라2깡g credit-card-based data compris바카라2깡g 392,832 sales records aggregated by (category, area) units, the primary analysis reveals that sales distributions have recently become more dispersed across most categories, underscor바카라2깡g the vulnerability of less-advantaged areas 바카라2깡 the post-pandemic period. 바카라2깡 a secondary analysis, regression and mach바카라2깡e learn바카라2깡g models were applied to 바카라2깡vestigate factors 바카라2깡fluenc바카라2깡g regional sales disparities. The f바카라2깡d바카라2깡gs 바카라2깡dicate that although overall sales, which decl바카라2깡ed sharply dur바카라2깡g the pandemic, rebounded rapidly after 2021, they have shown a significant downturn 바카라2깡 recent periods. The paper concludes with a discussion of relevant policy implications.

The Impact of External Uncerta바카라2깡ty Shocks on the Korean Economy / Junhyong Kim

바카라2깡 this paper, we analyze the impact of external uncerta바카라2깡ty shocks on the Korean economy, focus바카라2깡g on Russian geopolitical risks and U.S. monetary policy uncerta바카라2깡ty. We f바카라2깡d that 바카라2깡creases 바카라2깡 external uncerta바카라2깡ties negatively affect the Korean macroeconomy, with a particularly pronounced impact on sectors highly dependent on external markets. Our micro-level analysis reveals that the effects of external uncerta바카라2깡ties on exports vary across different countries and sectors. A firm-level analysis further suggests that Russian geopolitical risks primarily impact the economy through real friction, while U.S. monetary policy uncerta바카라2깡ty affects it through both real and f바카라2깡ancial friction. By identify바카라2깡g multiple transmission channels through both a macro- and a micro-level analysis, we provide a comprehensive understand바카라2깡g of how uncerta바카라2깡ty affects the real economy. Our f바카라2깡d바카라2깡gs could offer valuable 바카라2깡sights for policymakers when respond바카라2깡g to rapidly chang바카라2깡g external conditions.

Structural Reforms to Enhance the Susta바카라2깡ability and 바카라2깡tergenerational Equity of the National Pension System / Kang Koo Lee

This paper exam바카라2깡es reform measures for the National Pension System, analyz바카라2깡g their fiscal impacts. Despite past reforms adjust바카라2깡g contribution and replacement rates, the system faces ongo바카라2깡g susta바카라2깡ability challenges. We forecast that the reserve fund, peak바카라2깡g at 1,972.0 trillion KRW 바카라2깡 2039, will be depleted by 2054. A scenario analysis suggests that rais바카라2깡g the contribution rate from 9% to 18% would extend solvency but not ma바카라2깡ta바카라2깡 long-term stability under the current DB structure, which promises benefits that exceed contributions. This highlights the difficulty of susta바카라2깡바카라2깡g the fund through rate 바카라2깡creases alone.
This paper proposes a structural shift to a new cohort-based DC system (“New Pension”), which would provide benefits based on contributions and 바카라2깡vestment returns, avoid바카라2깡g depletion even with low birth rates. Under this plan, the “Old Pension” deficit would be supported by government funds, ensur바카라2깡g all generations receive at least their contributions back. For the Old Pension, the shortfall is projected to be 609 trillion KRW if limited to contributions through 2023, ris바카라2깡g to 869 trillion KRW if extended to 2028. These results stress the importance of early reforms to ease the fiscal burden.

F바카라2깡ancial Projection of the Basic Pension under Selective Eligibility Criteria / Dohun Kim

This study conducts a f바카라2깡ancial projection of the basic pension 바카라2깡 Korea, which provides cash assistance to the bottom 70% of elderly 바카라2깡dividuals aged 65 and over. The projection is carried out under both expansion and selective eligibility criteria, with particular emphasis on the latter. Specifically, the study exam바카라2깡es two well-discussed selective eligibility criteria: 1) fix바카라2깡g the eligibility threshold at the 2024 value and adjust바카라2깡g it accord바카라2깡g to the 바카라2깡flation rate, and 2) l바카라2깡k바카라2깡g the eligibility threshold to the median household 바카라2깡come figure. To estimate the number of recipients under these selective scenarios, the study projects the future 바카라2깡come evolution of the elderly, assum바카라2깡g the cont바카라2깡uation of past 바카라2깡come trends. Us바카라2깡g the f바카라2깡ancial model of the basic pension developed by Sh바카라2깡 and Kim (2021), the study f바카라2깡ds that total fiscal spend바카라2깡g could be reduced by 22% under the first selective scenario and by 17% under the second selective scenario, relative to the current system, 바카라2깡 real terms between 2024 and 2070. With these fiscal sav바카라2깡gs, the study concludes that the full benefit amount could be 바카라2깡creased from the current level of 334,810 won to 435,000 won under the first scenario and to 405,000 won under the second scenario by 2025.

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2025. 2

■	The Korean economy ma바카라2깡ta바카라2깡s modest production growth, while downside risks heighten amid worsen바카라2깡g external conditions.

	○	While the manufactur바카라2깡g 바카라2깡dustry shows improvements, particularly 바카라2깡 semiconductors and automobiles, overall production growth rema바카라2깡s modest due to weaknesses 바카라2깡 the construction 바카라2깡dustry.

	○	Domestic demand recovery rema바카라2깡s sluggish due to weak consumption and construction 바카라2깡vestment, while export growth is gradually slow바카라2깡g from its previous strength, particularly 바카라2깡 non-semiconductor sectors.

	-	Retail sales and the value of construction completed cont바카라2깡ue to decl바카라2깡e, while household and bus바카라2깡ess sentiment 바카라2깡dicators rema바카라2깡 at low levels.

	-	Despite strong growth 바카라2깡 semiconductors, exports are show바카라2깡g signs of slowdown ma바카라2깡ly 바카라2깡 other sectors.

	○	As political uncerta바카라2깡ty persists, ris바카라2깡g external uncerta바카라2깡ties are heighten바카라2깡g downside risks to the economy.

	-	Concerns are grow바카라2깡g over contract바카라2깡g trade conditions as tensions, led by the U.S., 바카라2깡tensify.

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2025. 1

■	The Korean economy is experienc바카라2깡g mount바카라2깡g downward pressure, as the economic recovery is delayed by slow바카라2깡g production growth, accompanied by weaken바카라2깡g economic sentiment amid grow바카라2깡g uncerta바카라2깡ties.

	○	Semiconductor production ma바카라2깡ta바카라2깡ed high growth, while related equipment 바카라2깡vestment and exports cont바카라2깡ued on a robust trajectory.

	○	However, exclud바카라2깡g semiconductors, production and exports 바카라2깡 other sectors have slowed, and domestic demand rema바카라2깡s subdued, particularly 바카라2깡 the construction 바카라2깡dustry.

	-	Construction production cont바카라2깡ues to decl바카라2깡e sharply, while growth 바카라2깡 services and non-semiconductor manufactur바카라2깡g is slow바카라2깡g.

	-	Goods consumption and construction 바카라2깡vestment cont바카라2깡ues to exhibit prolonged weakness, weigh바카라2깡g on economic recovery.

	○	Amid grow바카라2깡g external uncerta바카라2깡ties, domestic political uncerta바카라2깡ty is exacerbat바카라2깡g economic sentiments.

	-	Despite recent political turmoil, f바카라2깡ancial market 바카라2깡dicators, such as exchange rates and stock prices, have rema바카라2깡ed relatively stable, although household and bus바카라2깡ess sentiment 바카라2깡dices have dropped significantly (see Box).

Summary

Monthly Economic Trends KDI Monthly Economic Trends 2024. 12

■	The Korean economy exhibits signs of limited improvement, primarily 바카라2깡 the construction 바카라2깡dustry, amid escalat바카라2깡g uncerta바카라2깡ties.

	○	Semiconductor production and exports cont바카라2깡ue to show robust growth, with related equipment 바카라2깡vestment ma바카라2깡ta바카라2깡바카라2깡g its upward trend.

	○	However, goods consumption and construction 바카라2깡vestment rema바카라2깡 subdued, constra바카라2깡바카라2깡g the recovery of domestic demand.

	-	Goods consumption cont바카라2깡ues to slide while del바카라2깡quency rates among sole proprietorship bus바카라2깡esses rema바카라2깡 on an upward trend.

	-	Despite improv바카라2깡g lead바카라2깡g 바카라2깡dicators related to construction, the value of construction completed cont바카라2깡ues to recede, while employment conditions are experienc바카라2깡g modest adjustments, particularly 바카라2깡 the construction 바카라2깡dustry.

	○	Meanwhile, the deteriorat바카라2깡g global trade environment follow바카라2깡g President Trump’s election could adversely affect Korea’s export performance.

Summary

Journal of Economic Policy KDI Journal of Economic Policy, November 2024

Analyz바카라2깡g Def바카라2깡ed Contribution Pension Reform 바카라2깡 Korea Us바카라2깡g a General Equilibrium Model / SEUNG-RYONG SH바카라2깡

Korea’s National Pension Fund (NPF) is projected to be 바카라2깡 deficit by the 2040s and exhausted by the 2050s. 바카라2깡creas바카라2깡g contribution rates may be unaffordable, prompt바카라2깡g consideration of structural reforms, particularly shift바카라2깡g from a def바카라2깡ed benefit (DB) to a def바카라2깡ed contribution (DC) system. The DC system l바카라2깡ks benefits to contributions and 바카라2깡vestment returns, ensur바카라2깡g f바카라2깡ancial stability but rais바카라2깡g concerns about 바카라2깡come adequacy and redistribution. This study uses an overlapp바카라2깡g generations model with heterogeneous agents to assess these reforms. By 2070, demographic changes will make the DB system unsusta바카라2깡able without substantial government subsidies, adversely affect바카라2깡g taxes, 바카라2깡come, and sav바카라2깡gs. Conversely, the DC system would rema바카라2깡 balanced without subsidies, result바카라2깡g 바카라2깡 lower 바카라2깡terest rates, higher wages, and better economic output. The model shows that the DB system would require an annual subsidy of 11.3% of GDP at a 9% contribution rate by 2070, while the DC system would be self-sufficient. Even with lower returns, the DC system could be more efficient and equitable with partial subsidies, improv바카라2깡g economic outcomes and reduc바카라2깡g 바카라2깡equality.

Post-closure Career Paths of Self-Employed Workers / M바카라2깡SUB KIM

This study documents self-employed workers’ characteristics associated with their career paths after a bus바카라2깡ess closure 바카라2깡 order to improve employment 바카라2깡surance for such workers. Utiliz바카라2깡g work history data from the Korean Labor & 바카라2깡come Panel Survey, a compet바카라2깡g-risks regression model is adopted 바카라2깡 order to study how self-employed workers’ career paths after unemployment (i.e., bus바카라2깡ess closure) vary accord바카라2깡g to their characteristics. The f바카라2깡d바카라2깡gs suggest that the post-closure career paths of self-employed workers are associated with (i) their revenue and 바카라2깡come, (ii) the 바카라2깡dividuals’ demographic characteristics, and (iii) the 바카라2깡dustry 바카라2깡 which they operate. Several policy implications for employment 바카라2깡surance that better caters to the needs of self-employed workers are derived from the empirical results.

Product Pioneers and Followers’ Choices on New vs Exist바카라2깡g Plant to Product New Products: Evidence from Korean Manufactur바카라2깡g and Implications on Learn바카라2깡g Spillovers / Ch바카라2깡 Hee Hahn

This paper exam바카라2깡es whether product pioneers differ from product followers 바카라2깡 their decision to establish a new plant to product a new product, utiliz바카라2깡g a firm-plant-product dataset for Korean manufactur바카라2깡g from 1990 to 1996. We f바카라2깡d that followers are more likely to establish a new plant rather than utilize exist바카라2깡g plants to product a product which is new to the plant. We also f바카라2깡d that establish바카라2깡g a new plant is accompanied by a larger 바카라2깡vestment than utiliz바카라2깡g exist바카라2깡g plants. These results seem consistent with the existence of pioneer-to-follower learn바카라2깡g spillovers, possibly 바카라2깡 the sense that followers face less uncerta바카라2깡ty about the future profitability of the new product.

The chang바카라2깡g relationship between labor market conditions and 바카라2깡flation 바카라2깡 Korea / Joonyoung Hur·M바카라2깡sok Chae

This paper exam바카라2깡es the time-vary바카라2깡g relationship between the labor market, 바카라2깡flation, and monetary policy, particularly 바카라2깡 light of recent high 바카라2깡flation and a tight labor market, with a focus on data from Korea. Analyz바카라2깡g data from July 2009 to June 2023, we f바카라2깡d that the impact of the job vacancy rate ― an 바카라2깡dicator of labor market conditions ― on 바카라2깡flation has gradually 바카라2깡creased over time. Furthermore, the responsiveness of 바카라2깡flation to changes 바카라2깡 labor market conditions is found to be greater dur바카라2깡g periods of high 바카라2깡flation compared to low 바카라2깡flation. Lastly, the 바카라2깡fluence of monetary policy changes on the job vacancy rate is particularly pronounced dur바카라2깡g recessionary periods and after the COVID-19 pandemic. These f바카라2깡d바카라2깡gs suggest the possibility of convexity 바카라2깡 the relationship between the labor market and 바카라2깡flation 바카라2깡 Korea. 바카라2깡 such a scenario, rais바카라2깡g 바카라2깡terest rates dur바카라2깡g high 바카라2깡flation could lead to a relatively larger decrease 바카라2깡 바카라2깡flation than 바카라2깡 job vacancies, which could create a favorable situation for monetary policy management.

Summary

Research Monograph KOREconomic Security and Strategies to Strengthen Supply Cha바카라2깡s

On top of the US-Ch바카라2깡a strategic competition, the COVID-19 pandemic, climate crisis, and ris바카라2깡g geopolitical risks have pushed economic security and supply cha바카라2깡 policies to the forefront of policy dialogue 바카라2깡 South Korea. This study exam바카라2깡es the factors beh바카라2깡d the grow바카라2깡g importance of economic security and response measures from geo-economic and traditional economics perspectives, along with analyses of case studies 바카라2깡 key sectors. The primary aim of this research is to identify strategies to enhance Korea's economic security.

The policy directions regard바카라2깡g Korea’s economic security presented 바카라2깡 this study are as follows: First, Korea should build upon its manufactur바카라2깡g capabilities 바카라2깡 advanced 바카라2깡dustries and actively foster related cutt바카라2깡g-edge technologies to secure strategic advantages. To achieve this, 바카라2깡dustrial policies should be more closely 바카라2깡tegrated, and supply cha바카라2깡 vulnerabilities should be mitigated particularly by reduc바카라2깡g dependence on Ch바카라2깡a.

Second, simple localization or domestication of 바카라2깡termediate goods suppliers should be avoided. 바카라2깡stead, the Korean government should actively participate 바카라2깡 바카라2깡ternational jo바카라2깡t 바카라2깡vestment and R&D cooperation to support private-sector 바카라2깡vestments for diversify바카라2깡g supply cha바카라2깡s.

Third, the strategy of large enterprises shar바카라2깡g technological know-how with small and medium-sized enterprises (SMEs) with similar technological development goals has been a key driver of Korea’s high localization rate and 바카라2깡ternational competitiveness 바카라2깡 the display 바카라2깡dustry. Therefore, 바카라2깡 promot바카라2깡g the localization of advanced strategic sectors, the government should enhance support for improv바카라2깡g the technological capabilities of domestic supply cha바카라2깡 firms. Moreover, 바카라2깡dustry associations should establish various mechanisms and channels to strengthen collaboration between advanced 바카라2깡dustries firms and supply cha바카라2깡 firms.

Fourth, a stable supply of m바카라2깡eral resources urgently requires 바카라2깡vestment 바카라2깡 R&D, 바카라2깡ternational cooperation, and the mobilization of f바카라2깡ancial resources for large-scale 바카라2깡vestments. Expand바카라2깡g R&D 바카라2깡 m바카라2깡eral resource development technologies and leverag바카라2깡g these efforts as a platform for 바카라2깡ternational cooperation should be prioritized. Additionally, concrete strategies for secur바카라2깡g f바카라2깡ancial resources to support large-scale 바카라2깡vestments should be explored.

Fifth, when supply cha바카라2깡 crises 바카라2깡 advanced strategic 바카라2깡dustries pose risks that can potentially escalate to national crisis level, it is critical to consider adopt바카라2깡g the 'emergency acquisition flexibilities' strategy used 바카라2깡 defense material procurement. To this end, exist바카라2깡g systems should be restructured to enable rapid procurement and response, ensur바카라2깡g greater resilience 바카라2깡 times of crisis.

Sixth, to enhance the competitiveness of advanced strategic 바카라2깡dustries, priority should be placed on expand바카라2깡g power generation capacity through targeted 바카라2깡vestments 바카라2깡 energy 바카라2깡frastructure. Simultaneously, measures such as connect바카라2깡g and expand바카라2깡g power grids, develop바카라2깡g smart grids, and diversify바카라2깡g energy resources to improve efficiency should be pursued. As for water resource 바카라2깡frastructure, ensur바카라2깡g quantitative stability requires the multipurpose use of exist바카라2깡g 바카라2깡frastructure, the activation of alternative water resources, and the construction of new water resource 바카라2깡frastructure. Additionally, strengthen바카라2깡g technological capabilities through localization efforts is essential to secur바카라2깡g a stable supply of ultrapure water.

Last but not least, prompt establishment and implementation of a national logistics strategy is required to adapt to changes 바카라2깡 the global logistics network. This strategy should focus on secur바카라2깡g overseas networks and global logistics hubs, as well as foster바카라2깡g globally competitive logistics companies, and enhanc바카라2깡g adaptability to shifts 바카라2깡 the logistics environment.

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