Causes of Youth Poverty in Korea and Japan: An Exploratory Study

Abstract

This study aims at investigating the factors that contribute to economic insecurity and poverty of the youth in South Korea and Japan. This study uses ordered logit analysis on the data acquired from the Japanese General Social Survey (2006) and Korean Labor and Income Panel Study (2007). Research findings are as follows. First, labor market performance factors such as age, gender, educational ackground, and employment status influence the degree of youth poverty. Educational background, in particular, has relatively strong influence in Korea. As for employment status, in both countries, the difference between regular and non-regular jobs is a bigger factor in determining poverty risk than unemployment itself. Second, in terms of family status, married households and households with fewer children carry less poverty risk. This is attributable to the fact that in both countries, marriage itself is a luxury good of the rich, and having fewer children is a rational choice to reduce financial risk. Lastly, in both countries, the availability of parental resources, which allow the youth to cohabitate with their parents and to depend on parents income, influences the level of poverty among the youth. We discuss policy implications of these findings in the conclusion.