Asset Poverty and Material Hardship in South Korea

Decades of research and experience with anti-poverty programs around the world have revealed that there is more to poverty than simply maintaining a certain income level. However, until recently, poverty analysis in Korea has been mostly based on income. This study examines the multidimensional living conditions of the poor and its causes in Korea by testing the association between the material hardship and asset and income poverty. Material hardship is a direct poverty measure to identify the poor as those whose actual consumption fails to meet the basic needs. The main purpose of this study is to contribute to our understanding of the living conditions of the poor and the causes of material hardship including food, housing, utilities, and health hardship. Using the binary logistic regression analysis, this study found that households who were poor only in assets (and not income) were more likely than households who were income poor but not asset poor to experience all types of material hardship except for food. This finding suggests that the asset poor are more vulnerable to material hardship than is estimated by the income poverty measure. We describe how future research needs to expand hardship measures to encompass various living conditions in relation to the current Korean social context. This study implies that policy responses to poverty could be improved to the extent they consider the type and amount of a household’s available economic resources.