In the early 21st century, one's birthplace is increasingly a determining factor for economic prospects, with the geographical location heavily influencing lifetime earnings. An economist, Branco Milanovic, coined terms like 'citizenship premium' and 'citizenship penalty' to describe the advantages enjoyed by those born in wealthy countries compared to the disadvantages faced by those from poorer nations. This perspective is mirrored in a recent report by the Bank of Korea, which emphasizes the divide between individuals experiencing 'hometown premiums' and those suffering 'hometown penalties' within South Korea itself.

Approximately half of South Koreans live in their birthplace, and the region of birth considerably affects their economic capability. Those born in regions with high income levels and asset prices are likely to inherit similar economic advantages from their parents, while those from poorer regions face increased risks of economic disadvantage. The widening gap between the capital region and non-capital regions exacerbates these inequalities, indicating that children born in metropolitan areas will continue to outperform their counterparts from less affluent regions.

The article also discusses the implications of migration, noting that children from non-capital regions who move to the capital often see significant improvements in their economic status; however, those who relocate only to nearby cities experience diminished benefits. Over generations, disparities in income based on institutional education—particularly between metropolitan and non-metropolitan universities—are becoming increasingly pronounced, which may explain the decline of regional universities that once held prestige as they fall behind their Seoul-based counterparts.