Growth and Reform in the Korean Economy Proceedings of the Conference on Growth and Reform in Korea – Implications for Australia

This paper explores the issue of outward foreign direct investment (OFDI) exporting Korean jobs during 9862003. In the midst of an overall increase in employment in Korea, there was a temporally coincident increase in OFDI and a decline in manufacturing employment. An examination of the employment structure and capital stock changes suggests that there had been a structural transition in the Korean economy from a capital intensive to a knowledge intensive base. Simple regression analyses demonstrated that the OFDI from Korea had a checking effect on rising unemployment. As such, the increase in unemployment can be attributed to the trends of the time and the East Asian financial crisis.