With a fertility rate of 1.18 in 2013, Korea ranks the lowest among the
members of OECD. Korea is now experiencing a trend of an aging population.
If this trend continues for some time, Korea may not be able to survive on this
planet.
This paper attempts to demonstrate that Korea’s long-term benchmark
fertility rate is two children and argues using the results of the UN’s recent
population study that Korea’s actual fertility converges to its long-term
benchmark rate of 2.0 in the next 35 years towards 2050. Also this paper
argues that the actual path of fertility movement depends on both the
government’s child-support policy and the relative strength of the income effect
over the price effect of woman’s wage income.