Dr. Hyun-A Kim is a Senior Economist at the Korea Institute of Public Finance (KIPF). Last week she visited SPIA to give a talk on how public policy can help reduce income inequality, called “Inequality and Inclusive Growth: Considering Education in Korea and the U.S.”
Dr. Kim’s research offered perspectives on the state of economic inequality around the world.
“In many OECD (Organisation for Economic Co-operation and Development) countries, inequality is at its highest level in thirty years and continues to rise.” She also discussed the differing effects that globalization has had across the globe: globalization has led to increased economic inequality in most countries, especially highly developed countries like Korea and the U.S., but has also led to decreases in economic inequality in a few countries like Turkey and Greece.
Kim’s work also shows the negative effects of high levels of income inequality, particularly the harmful effects it can have on employment rates and the labor market. She demonstrated that as inequality increases, life expectancy tends to decrease. Similarly, her work shows that as the top one percent of income earners dominate more of the market in a country, societal evaluations of happiness decrease.
Kim points to “inclusive growth,” economic growth that is distributed across society, as a potential solution that could lead to more economic mobility and more opportunities for the working class. Research shows that when governments decide to create policies that encourage inclusive growth, equity of opportunities increases and everyone gets to participate in the economic benefits that come from the economic growth.
Kim believes education can “be a force of convergence,” to decrease the income divide. However, she notes, governments must first improve the equality of education and expand access to higher level education. One way she sees of doing this is decreasing the resource gap and providing more centralized funding for education, pre-kindergarten through college.