Recently in the United States, a partial government shutdown meant millions of low-income families missed their food assistance payments. The disruption reignited an old question that every developed nation grapples with: How much should societies help their poorest members, and in what form?

This question matters everywhere, including in Korea, where debates about welfare expansion, working-age poverty, and the sustainability of social programs have intensified in recent years.

Over the past four decades, thinking about poverty relief has shifted dramatically across the developed world. The traditional model was one of support for those without work. Historically, poverty alleviation programs started by targeting groups that were not expected to work, such as widows or people with disabilities. Over time, however, a new model has taken hold. One that targets assistance to low-wage workers, especially those with children. The idea was to encourage employment rather than replace it. This signaled a shift from traditional "welfare" to "workfare." Today, across most wealthy nations, public assistance flows more readily to the "working poor" than to those outside the labor force entirely.

The United States exemplified this shift with programs like the Earned Income Tax Credit, which supplements wages for working families. France introduced similar policies with its "prime d'activite." The UK has recently reformed its Working Tax Credit. The logic behind these changes rested on two observations. First, the old systems sometimes discouraged people from taking jobs. When accepting work meant losing benefits worth more than the wages offered, staying unemployed became the rational choice. Second, there was a reduction in political support for helping those who were considered to be able to work but chose not to.

Korea's Earned Income Tax Credit (EITC), introduced in 2008 and expanded several times since, now serves over 4 million households. It embodies this same philosophy: reward work, not joblessness.

Yet Korea faces distinctive challenges. The country's labor market remains highly segmented between regular and non-regular workers, with the latter group often falling between the cracks of the social safety net and standard employment benefits. For these workers, programs that supplement earned income matter enormously — but only if they can access stable employment in the first place.

Whether citizens support welfare programs depends on more than economics. Research shows that beliefs about fairness matter just as much as concerns about efficiency. The following factors are key for support for redistribution.

First, consider equality of opportunity. People who believe everyone starts life with roughly equal chances tend to oppose redistribution. In their view, different outcomes reflect different levels of effort and merit. On the contrary, those who see the playing field as biased because of family wealth and a lack of social mobility support stronger safety nets. They recognize that birth circumstances shape life prospects in ways individuals cannot control. To some extent, different views on social mobility between the US and Europe can explain why there is generally lower support for redistribution in the US: Americans are more optimistic about social mobility than Europeans are.

Second, the identity of beneficiaries also matters. Support for welfare programs drops when people perceive that benefits flow primarily to those outside their own national, ethnic, or religious community. In the United States, research has documented how racial attitudes influence welfare preferences. In both the US and European countries, opposition to social spending often correlates with higher actual and perceived levels of immigration. In short, people often find it less fair to redistribute towards those who are different from them.

Third, mindsets shape preferences too. Those who see the economy as zero-sum, where one person's gain is another's loss, favor more redistribution because they believe the government should step in and correct this unfair situation in which one group is gaining at the expense of another. On the contrary, those who have a positive-sum mindset and believe that wealth creation will "trickle down" prefer to limit redistribution because they believe that when some get richer, it is a tide that lifts all boats. These are not just abstract philosophical positions. Research shows that they translate into vastly different views about tax rates, spending priorities, and the size of government. Importantly, in many rich countries, younger generations are more likely to hold a zero-sum mindset than older generations. Consequently, they tend to support more redistribution.

Finally, the form of assistance matters to how fair it is perceived by public opinion. In-kind benefits such as food vouchers or housing subsidies, tend to win more support than cash transfers. They seem concrete and controlled, while cash raises fears of misuse. In the United States, critics of food assistance programs often point to purchases they consider wasteful or unhealthy.

Standard economic theory suggests that cash transfers are more flexible, more efficient, and more respectful of recipient autonomy. They let people address their most pressing needs without restrictions. Yet public trust in low-income households' spending decisions remains limited across countries, which generally leads to more support for in-kind redistribution.

Korea has experimented with both approaches. The country's Basic Livelihood Security Programme provides both cash and in-kind support, while local governments have increasingly adopted voucher-based systems for childcare and other services. The Gyeonggi Province youth basic income program, which provided unconditional cash payments to young adults, sparked heated debate when introduced, partly because cash felt less controlled than targeted benefits.

Despite persistent debates about welfare programs, research consistently demonstrates their value. Especially when they target children and their families, the benefits often exceed the costs.

Research studies in the United States have tracked children who received food assistance into adulthood. The findings are striking: better health outcomes and higher earnings. Other research shows that cutting off support when young people reach adulthood increases crime rates and ultimately costs society more through criminal justice expenditures than it saves in welfare spending.

Some social programs effectively pay for themselves through long-term positive income effects. And this calculation doesn't even account for improvements in wellbeing and life quality that are harder to quantify but no less real.

The debate over welfare support is not likely to ever fully resolve because it touches fundamental questions about justice, responsibility, and social obligation. People will often disagree about where to draw lines. And, as fiscal pressures increase, support for more generous welfare programs might start to erode further. Korea faces a challenge familiar to many rich countries today: maintaining or building a more comprehensive welfare state while managing fiscal pressures from rapid demographic aging.

But evidence should inform these debates. Programs that support children, in particular, rank among the most cost-effective public investments available. They improve health, strengthen education, stabilize families, and ultimately enhance social cohesion.

Certainly, welfare programs can and should be improved. Better targeting, reduced administrative burdens, and smarter incentive structures all deserve attention. But the fundamental value of these programs must be protected. In Korea and elsewhere, the question should not be whether to provide support to those in need, but how to do so most effectively.

Stefanie Stantcheva

Stefanie Stantcheva is co-editor of the Quarterly Journal of Economics. The views expressed here are the writer’s own. — Ed.


khnews@heraldcorp.com