Industrial Relations and Wage Inequalities in East Asia EeHwan Jung Seoul National University of Technology This article explores the relationship between industrial relations and wage inequalities in Korea, Japan, and Taiwan. Industrial relations as ...

Industrial Relations and Wage Inequalities in East Asia EeHwan Jung Seoul National University of Technology This article explores the relationship between industrial relations and wage inequalities in Korea, Japan, and Taiwan. Industrial relations as a labor market institution can be categorized into three types: market type, decentralized bargaining type, and coordinated bargaining type. While Korea’s industrial relations have changed from the market type to the decentralized bargaining type in the late 1980s, Japan’s and Taiwan’s industrial relations have stayed as the (weak) coordinated bargaining type and the market type respectively. This difference of industrial relations affected the trend of wage inequalities in the three countries. Korea witnessed a large increase in overall wage inequality in the 1990s, which was mainly due to the increase in the wage gap across firm size. Though Japan has always had a considerable amount of wage gap across firm size, this gap and overall wage inequality have not increased since 1990. In Taiwan, where the wage gap across firm size was the smallest of the three countries, wage inequalities have not increased since 1990. The effect of industrial relations on wage inequalities is, however, only partial.