Seoul, Sep 20 (IANS) South Korea ranked near the bottom of Organization for Economic Cooperation and Development (OECD) member countries in income redistribution through taxes and welfare systems, latest data showed on Sunday.
South Korea’s improvement rate in the Gini coefficient was 17.6 percent in 2023, the latest year for which OECD data is available, according to an analysis by Yonhap News Agency.
The measure compares the Gini coefficient for market income before taxes with that for disposable income after taxes and transfers.
The figure was about half the OECD average of 34.4 percent, ranking South Korea 28th among the 29 OECD member countries with available data. Only Costa Rica ranked lower, at 12.1 percent.
The findings come as the South Korean economy has entered an expansionary phase on strong semiconductor exports, while concerns remain that economic polarisation could become entrenched.
The Gini coefficient measures income inequality, with zero representing perfect equality and one representing perfect inequality.
South Korea’s market-income Gini coefficient in 2023 was 0.392, the lowest among the 29 OECD countries compared, indicating the highest level of equality. Its disposable-income Gini coefficient was 0.323, however, leaving the country ranked 22nd after taxes, pensions and benefits were taken into account.
“The results show that South Korea’s income redistribution through taxes and other measures is relatively weak compared with other OECD countries,” said Kim Kwang-seok, a researcher at the Institute for Korean Economy & Industry.
He called for stronger government support for low-income households.
Meanwhile, the South Korean won slightly weakened against the US dollar, after the Bank of Japan (BOJ) delivered an expected rate hike.
The won was quoted at 1,383.3 won per dollar at 3:30 p.m., down 1.1 won from the close of the previous stock trading session.
Last week, the won was under pressure over the U.S. Federal Reserve’s rate hike and rising oil prices following renewed military tension between the United States and Iran in the Middle East.
—IANS
na/
