Market Characteristics, Human Capital Accumulation and Wage Structure£º Empirical Evidence from the Korean Financial Sectors
Kang-Shik Choi․Bo Sung Shin․Jin Hwa Jung
This paper explores the nexus between industry-specific market characteristics and an industry¡¯s wage structure and the pattern of human capital accumulation of workers. This study hypothesizes that the inter-industry differences in the market characteristics lead to the industrial differences in both skill requirements and the compensation scheme. The empirical evidence indicates that the competitive market structure and the ¡°tailored¡± products of the Korean securities industry induce a large industrial wage premium, which escalates for high-ability workers, with human capital investment skewed toward general skills rather than firm-specific skills. The oligopolistic market structure and ¡°standardized¡± products of the Korean banking industry yield an interesting labor market outcome that contrasts with its counterpart in the securities industry, which is worthy of elaboration.
Keywords : Market Characteristics, Human Capital Formation, Wage Distributions, Securities and Banking JEL Classification Number : J24, J31, G20