Social Gap in Korea: The Effects of Economic Deprivation on Social Capital and Self-identified Social Stratum

In Korea, the gap between the poor and the rich has become a serious social problem since economic crisis, 1997. Income distribution had been equalized until 1997, but income disparity has taken sudden turn for a worse after economic crisis. The previous studies on social impact of economic crisis include polarization of social stratum, appearance of the new poor population, expansion of irregular workers, popularization of unemployment and dissolution of family, disbanding of social relations etc. How the economic crisis has deepened the social gap in Korean society? The social crisis has directly linked economic troubles after economic crisis. The economic troubles often make people withdraw from social relations and underestimate one’s socioeconomic status, and by extension they affect negatively the hope for the future. The purpose of this paper examines the negative effects of economic deprivation on social capital. Furthermore we explore the economic deprivation and reduced social capital has negative influence on self-identified social stratum, life satisfaction and optimism for one’s future. The economic deprivation such as difficulties of earning daily bread, unstable housing condition, and overdue educational expenses as well as worsening family financial situation are the critical independent factors which negatively affect on the one’s social relations and subjective ethos. The economic deprivation has a bad effect on the social aspiration and upwardly mobile expectation. Thus the financial predicaments have been deepening the social gap among the people in the way of decline of social capital and lowering self-identified social stratum and social aspiration. We utilize the national survey data which conducted by Institute for Social Development and Policy Research, SNU in October 2012.  Interviews were conducted with male and females age 19 and above. The total usable sample size was 1,000. The sample was selected through a process of multi-stage area cluster probability sampling.