1990 Fiscal Year Final Research Report Summary
Theoretical and Empirical Studies on Japanese Employment Systems
| Project/Area Number |
01530022
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| Research Category |
Grant-in-Aid for General Scientific Research (C)
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| Allocation Type | Single-year Grants |
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| Research Field |
経済事情及び政策学
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| Research Institution | Hitotsubashi University |
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Principal Investigator |
ARAI Kazuhiro Hitotsubashi University, Faculty of Economics, Professor, 経済学部, 教授 (40134879)
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| Project Period (FY) |
1989 – 1990
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| Keywords | Lifetime Employment / Internal Labor Market / Seniority-Based Wage System / Wage Differentials By Age / Wage Profile / Overlapping Generations Model / Quality Of Labor |
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| Research Abstract |
This research has studied theoretically and empirically the causes of internalization of labor input and the determination of wage profiles (wage differentials by age) in internal labor markets. Almost all existing models on internalization are based on the concept of specific human capital, but this research has emphasized the benefit of cooperation among workers and that of intergenerational transfers which are realized when internalization develops enough. In the theory on the determination of wage profiles, particular emphasis has been placed on an explanation of variation of profiles. The existing models on wage profiles hardly explain the variation, but this research pointed out such factors for variation as absorption by risk-neutral firms of risks facing workers in consumption and sharing of those risks among workers of different generations, as well as some structural and institutional factors. I have undertaken large-scale empirical studies on the variation of wage profiles and obtained results that support the above theory. I have also undertaken empirical studies that compare the validity of my theory with that of well-known competing theories, which are not necessarily theories on wage profiles. By considering the effects of ratios of effective labor demand to effective supply on wage profiles at several different dates, I have shown that those competing theories are not so powerful. Though these empirical analyses are based on time-series data, I have undertaken crossーsectional analyses based on prefectural data as well and obtained results favorable to my theory. Finally, since educational background is one of the most important factors for wage differentials, by using crossーsectional data I have analyzed the determinants of higher education enrollment with special attention to socio-economic factors.
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