2012 Policy Agenda for Social Expenditure

Abstract

The Flexibility in the labour market has brought about many problems in the welfare system. It is very important for the welfare system to respond to this situation. In order to investigate the policy possibilities for Korea this study has inquired into the experiences of the advanced welfare states according to welfare state types and leads to the following results. Firstly, there are Anglo-Saxon countries that has the almost unlimited flexible labour market and the very limited welfare response to that. Secondly, there are two kinds of flexicurities, that is flexibility in the labour market combinated with security. The one can be called as the regulated flexicurity that can be found in Sweden. In this case the labour market has the flexibility but is regulated. The other can be called as the unregulated flexicurity that can be found in Netherlands and Denmark. In this case the labour market has the flexibility without almost no regulation. Thirdly, there are two kinds of dualization in the labour market. The one is the flexible dualization in the case of Germany. In Germany the core group of workers is well protected and others are not. But the mobility between two groups is not constrained by the rigid institution. And the weaker group in the labor market is protected by the welfare system like family service or social assistance. The other is the rigid dualization in the case of Japan. In Japan the regular workers of the organized labor union in the large enterprises are well protected and the others are not. And the weaker group is not so well protected by the welfare system. Fourthly, the economic performance of the flexicurity and the flexible dualization countries is better than the other countries. Korean labour market is dualized and the weaker group has not sufficient protection of the welfare system like Japan. Therefore it could be the first choice for Korea that the course of the flexible dualization with welfare protection for the weaker workers is taken.