An Introduction to Affirmative Action Policies in Korea: Consequences and implications for Japan

In 2006, the Korean government introduced affirmative action (AA) policies in the private sector in order to promote women's entry into the labor force and also to better utilize their talents. Through this effort, women's employment rates as well as the proportion of women in managerial positions have risen. Based on the Workplace Panel Survey collected by the Korea Labor Institute, we analyze the effects of AA on women's employment and the share of women in managerial positions and return on assets (ROA), finding that companies which introduce AA experience not only advancement of women's career status, but also increases in their return on assets. In Japan, introduction of AA is on a voluntary basis. Thus, relatively few corporations are willing to increase the number of women in management. Korea's experience suggests that improving women's economic status provides positive economic benefits to corporations as well as society as a whole. Thus, introduction of AA in Japan seems desirable.