14 Structural Adaptation of the Japanese Economy and Labor Market

Japan’s so-called Lost Decade of the 1990s presents a unique case study of an economy with a recent severe and prolonged recession, with large changes in the labor market and fiscal policy as the main policy available to the government. Japanese unemployment rate surged from 2.1% in 1991 to 5.4% in 2002. Meanwhile, the Japanese economy experienced a rise in government expenditures, while taxes remained fairly stable. This paper quantitatively evaluates the impact of these changes in fiscal policies on labor market variables, in particular the unemployment rate, during the 1990s. We build, calibrate, and simulate a dynamic general equilibrium model with search frictions in the labor market, a productive government sector, heterogenous government spendings, and different categories of taxes. Our model is able to reproduce the paths of the main labor market variables, and the counterfactual experiments show that the changes that took place in the different spending components affected the unemployment rate heterogeneously, although overall they kept unemployment lower than it could have been. We also find that had the government also implemented countercyclical tax policies, unemployment would not have risen as much as it did by 2002.

Download Full-text

Trouble in Paradise: Institutions in the Japanese Economy and the Youth Labor Market

The Economic Sociology of Capitalism ◽

10.1515/9780691217932-019 ◽

2005 ◽

pp. 419-444

Author(s):

Mary Brinton

Keyword(s):

Labor Market ◽

Japanese Economy ◽

Youth Labor Market

Download Full-text

Japanese Redundancy: The Impact of Key Labor Market Institutions on the Economic Flexibility of the Japanese Economy

Labor Market Adjustments in the Pacific Basin ◽

10.1007/978-94-009-3251-7_5 ◽

1987 ◽

pp. 79-101

Author(s):

Kazuo Koike

Keyword(s):

Labor Market ◽

Japanese Economy ◽

Labor Market Institutions ◽

Market Institutions ◽

The Impact

Download Full-text

Working in Japan

Immigrant Japan ◽

10.7591/cornell/9781501748622.003.0004 ◽

2020 ◽

pp. 62-83

Author(s):

Gracia Liu-Farrer

Keyword(s):

Labor Market ◽

Career Mobility ◽

Japanese Economy ◽

Labor Market Participation ◽

Market Participation ◽

Socioeconomic Mobility ◽

Structural Holes ◽

Highly Skilled ◽

Transnational Entrepreneurship ◽

Immigrants In Japan

This chapter maps the diverse patterns of immigrants' labor market participation and career mobility. Several characteristics stand out. First, immigrants in Japan occupy diverse roles in the Japanese economy. They provide low-wage casual or disposable labor in the secondary labor market as well as work as highly skilled professionals in global businesses. Second, different national or regional backgrounds have shown uneven potential for socioeconomic mobility. Finally, the chapter shows that immigrants are creatively engaged in the Japanese economy. Not only are they needed as supplemental labor, but immigrants in Japan are also forces for bridging the Japanese economy with markets outside the country. The chapter then highlights the strategies that immigrants employ to find their niche in Japan's economy—from occupational niching to transnational entrepreneurship. Through finding niches and bridging structural holes, immigrants utilize their unique capacity to not only survive and thrive in Japan's economy but also act as the agents of globalization.

Download Full-text