Income and Poverty Dynamics among Older Koreans

We examined the economic wellbeing of the Korean elderly and their reliance on public and private transfers. Under-developed public transfer programs are at the center of heated political debates, and better understanding of economic wellbeing and the relation between public and private transfers will provide further insights in evaluating policy reform proposals under consideration. Using panel data from three waves of Korean Longitudinal Study of Aging (KLoSA), we found that the elderly poverty rate between 2006 and 2008 decreased significantly but was still significantly higher than other OECD countries. This poverty reduction did not benefit individuals who were older, less educated, living alone, living in rural areas, or in poor health. We found that low income elderly who co-reside depend almost completely on the income of their children or other household members. Public transfers account for no more than a third of income for low-income elderly, while private transfers accounted for half.