Testing the dual structure of the Japanese labor market

Akiomi Kitagawa, Souichi Ohta, Hiroshi Teruyama

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

This chapter empirically investigates the dual structure of the Japanese labor market by considering employment status as an expression of duality. The data are obtained from a series of micro surveys on employment, conducted in the Tokyo metropolitan area during 2002–2014. The first half of this chapter focuses on empirical arguments about the contrasting properties of wage profiles between regular and non-regular workers, and the flattening of wage profiles of the former. The second half examines the employment status sluggishness, which is defined by the effect of the employment status of the previous job on the current one. In addition, we examine the possibility that the probabilities of a worker’s allocation to a certain sector are determined at their time of entry into the labor market. These so-called first-job effects are defined by the effect of the employment status of the initial job on the current one. The estimated results reveal several facts regarding the new phase of the Japanese dual labor market. (1) While regular workers’ wages rise with years of tenure and external experience, only the latter influences non-regular workers’ wages. (2) The wage increases based on experience are of a similar magnitude across employment statuses, except for female regular workers; firm-size and educational-background premiums exist only in the regular workers’ wages. (3) The slopes of regular workers’ wage-tenure profiles have remained stable for more than 10 years since the early 2000s. (4) The quantitative impact of the first-job effects is not very substantial. The serially dependent structure of employment status has a greater influence on the rising labor market segmentation.

Original languageEnglish
Title of host publicationAdvances in Japanese Business and Economics
PublisherSpringer
Pages119-168
Number of pages50
DOIs
Publication statusPublished - 2018 Jan 1

Publication series

NameAdvances in Japanese Business and Economics
Volume12
ISSN (Print)2197-8859
ISSN (Electronic)2197-8867

Keywords

  • Cohort effects
  • Dual labor market
  • Employment status
  • First-job effects
  • Wage profiles State dependence

ASJC Scopus subject areas

  • Business and International Management
  • Strategy and Management
  • Economics and Econometrics
  • Finance

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  • Cite this

    Kitagawa, A., Ohta, S., & Teruyama, H. (2018). Testing the dual structure of the Japanese labor market. In Advances in Japanese Business and Economics (pp. 119-168). (Advances in Japanese Business and Economics; Vol. 12). Springer. https://doi.org/10.1007/978-981-10-7158-4_4