Economic Assimilation of North Korean Refugees in South Korea: Survey Evidence

Abstract

This paper studies the economic assimilation of North Korean refugees settled in the South. Do the North Korean refugees get assimilated into the labor market in the South at all? If yes, how fast is the assimilation? More specifically, what is the initial wage gap at the entry between refugees and native workers with identical observable characteristics? How does the gap change as time passes? For the purpose, we analyze the unique survey data set constructed for this study. The cross section survey has detailed retrospective information not just on labor market activities of the refugees, but also on their economic life while still in the North. The survey covers about 700 adult refugees. For the comparison of the refugee workers with the natives, the survey data set are combined with the 2002 wave of the Korea Labor Institute Panel Study (KLIPS). In comparison to the assimilation of immigrant workers in the US, initial wage gap seems much larger for the North Korean refugee workers, but also closes at a higher rate than is the case in the US. The disconcerting finding is that the gap in employment probabilities is also large in the Korean context, and takes a long time to close, especially for female refugee workers.

Keywords: economic assimilation, refugees, North Korea

JEL Classification: D63, E24, J31