This paper attempts to analyse the effects of education on income distribution in Korea. The human capital theory suggests that an unequal distribution can be reduced by improving the distribution of education because variations in labor income are due to the differences in labor quality in terms of the amount of human capital, especially education, acquired by the workers. On the other hand, a general skepticism about the role of education also can be observed. Thurow, for instance, has shown that in the United States, a country which is a prominent example of educational expansion, schooling has had only a negligible effect in reducing income inequality, although education constitutes one of the key elements in economic growth. Critics of human capital theory, one example is the labor market segmentation theory, asserts that education cannot improve earnings inequality unless other institutional factors, such as occupational earnings structure, are changed. By investigating those two approaches, we can assess whether education can be used as a policy tool to improve the earnings distribution.
Development of the Human Capital Theory in the 21st Century: Megatrends and the Russian Context
