This study investigates the paradox of policy by analysing the coherence between policy goals and policy alternatives for income-led growth policies. The income-led growth policy was designed to resolve income polarisation and low growth by securing stable domestic demand via income increase of low-income families with high consumption propensity. The impact of transfer income, social insurance income, and earned income, which are major tools of income-led growth policy, on gross income was analysed with the KLIPS(Korean Labor and Income Panel Survey) conducted from 1998 to 2019. This study found that transfer income, earned income, and social insurance income - in that order - had an effect on the gross income of low-income families. When the minimum wage was sharply raised in 2018, which was one of the policy instruments for income-led growth policy, the family-income increase was not higher than that of other years. This study suggests that income-led growth policies need to be improved. It is necessary to consider ways to manageearned income by lowering the level of the minimum wage increase rate, maintaining competitiveness in labour-intensive industries such as manufacturing and working the role of low-income families as consumers in the stable domestic market.

Income-led growth , policy evaluation , inclusive growth , wage-led growth , dynamic panel regression analysis