The impact of the hope growing account program on participants’ economic well-being in South Korea

Abstract

In 2010, the Korean government introduced the Hope Growing Account (Hope) program. The Hope program combines elements of a social assistance scheme (monthly income grants) with matched funds for savings to encourage the working poor to increase income and build assets. This longitudinal study estimated changes in household economic well-being among 895 low-income households who participated in Hope between 2010 and 2012. Economic well-being was measured by changes in household monthly income and income-to-needs ratio. The adjusted difference-in-differences estimation revealed that the impact of Hope varied over household income distributions: lower income households were more likely to increase their monthly earned income and income-to-needs ratio compared to demographically similar non-participants, while higher income households were less likely to increase their income and income-to-needs ratio. We describe how future research is needed to better understand how the Hope program impacts household assets and behavioral changes in the long run.