) Pergamon PII: S0261-5177(98)00033-8 Tomism Management, V(fl. 19, No. 4, pp. 341-348. 1998 '~3 1998 Elsevier Science Ltd. All rights reserved Printcd in Great Britain 0261-5177,'98 $19.()(1 + ().()tl Measuring earnings inequality and median earnings in the tourism industry Choong-Ki Lee Department of Tourism Management, Dongguk UniversiO,, 707 Sukjangdong Kyongju, Kyongbuk 780-714, Korea Seyoung Kang Graduate School of Women's Studies, Keimyung Universit3~ 2139 Daemyungdong Namgu, Taegu 705-701, Korea The purpose of this paper is two-fold: to measure the degree of earnings inequality in tourism employees in South Korea, using the Gini coefficient and the Lorenz curve; and to examine the level of earnings based on median earnings. The results show that tourism generates a moderately equal distribution of earnings. In general, tourism performs earnings distribution better than secondary and tertiary industries, but it performs poorly as compared with primary industry. The results also indicate that tourism is more likely to improve living standards for the lower income class than secondary and tertiary industries.The analysis of median earnings, however, indicates that tourism is a low wage industry. The labor-intensive nature of the tourism industry absorbing many unskilled and semi-skilled workers might be attributed to its low wage structure. It is interesting to note that tourism was found to be advantageous to female workers in terms of earnings inequality and the level of earnings. © 1998 Elsevier Science Ltd. All rights reserved Introduction Tourism development has been regarded as a positive means of generating income, job opportuni- ties, business turnover, government taxes, and foreign exchange earnings. Policymakers are concerned with the economic aspect, since the positive economic impact is necessary to enhance local economies and improve living standards. Another aspect to be considered will be the distri- bution of earnings among income classes. If earnings distribution in an industry is skewed toward a particular class (e.g., a higher income class), it will be undesirable in terms of 'social cquity'. Thcrefore, economic policy must also address the distribution of earnings among income earners. To date, tourism research neglects to assess who gains and who loses from tourism development.' This implies that tourism development should be cvaluated as to whether it is likely to contribute to equal distribu- tion of earnings among tourism employees and whether it is likely to improve living standards for the poor. Rose et al. 2 argue that policymakers are hampered by the lack of an operational model which enables them to determine who gains and who loses from alternative resource allocation decisions, Painton ~ attempts to compare three development projects by measuring earnings inequality. Lee 4-~ also measured the degree of earnings inequality in the tourism industry in South Korea, using the Gini coefficient and the Lorenz curve. Comparisons were made between tourism and other major industries in terms of earnings inequality. The purpose of this study is two-fold: (i) to measure the degree of carnings inequality among tourism industry employees in South Korea, using the Gini coefficient and the Lorenz curve; and (ii) to examine the level of earnings by computing median earnings. Earnings inequality and median earnings of tourism industry employees are then compared with those of other industry workers. Earnings differentials in South Korea Table 1 presents earnings differentials across four categories of education level, based on earnings 341