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The share of social welfare expenditure in local governments' budgets has been rapidly increasing since 2002 in Korea, due to demographic changes and shifting orientations of fiscal policies from economic development to social welfare. The increasing share of social welfare expenditure is influencing the revenue and spending structures of local governments which face highly rigid budget constraints, in various ways. Therefore, we measure the degree of fiscal pressure in rapid increases of social welfare spendings of local governments, by using two standardized indices of 'percentage change in social welfare during 2002-2010' and 'share of social welfare in 2010'.We categorize local governments into four groups and analyze the degree of fiscal pressure in order to find differences across groups in, how local spending structure has been adjusted and how local revenue structure has been changed in response to the increase of social welfare spending.
