What the study found
Tenure has little effect on wages at around 10 years, but longer tenure is associated with higher wages in South Korea.
Why the authors say this matters
The study suggests that sector-specific skills play a critical role in wage growth, and the authors conclude that understanding different kinds of experience helps explain wage returns.
What the researchers tested
The researcher used 20 years of data from the Korean Labor and Income Panel Study (KLIPS) to examine wage returns to general experience, firm tenure, and industry- and occupation-specific tenure in South Korea. The study used the Altonji and Shakotko instrumental variable approach and the Topel two-step estimation method to address bias from unobserved heterogeneity.
What worked and what didn't
Ten years of tenure had no significant effect on log wages. Twenty years of tenure increased wages by 11% to 30%, while sector-specific skills were linked to wage growth and occupation-specific returns were minimal.
What to keep in mind
The abstract does not describe additional limitations beyond the methods used to address bias, so no further caveats are provided in the available summary.
Key points
- The study examined wage returns to general experience, firm tenure, and industry- and occupation-specific tenure in South Korea.
- Ten years of tenure had no significant effect on log wages.
- Twenty years of tenure was associated with a wage increase of 11% to 30%.
- Sector-specific skills were described as playing a critical role in wage growth.
- Occupation-specific returns were minimal.
Disclosure
- Research title:
- Tenure shows limited wage gains in South Korea
- Authors:
- Pyoungsik Kim
- Institutions:
- Korea Institute of Public Finance
- Publication date:
- 2026-03-06
- OpenAlex record:
- View
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