Using 22-year repeated cross-section data for South Korea, this study investigates the decomposition of consumption and income inequalities, that is, age, cohort and year effects, by constructing pseudo-panel data and conducting a cohort analysis. We demonstrate several important findings. First, the overall trend of consumption inequalities for all ages is different from that of isolated age effects. Controlling for age effects, a linearly increasing trend strongly supports the general

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... ions of life cycle-permanent income hypothesis. Second, age effects in South Korea differed greatly from those for Taiwan, the US and the UK. There was a strong linear relation over after age 35, while effects in the other countries indicated a linear or convex relation. Third, age effects on income showed a downward tendency until age 35 and an upward turn thereafter, while income effects tended to consistently increase. Finally, cohort effects for consumption show reversing trends and are therefore different from income effects.