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GINI Country Report: Growing Inequalities and their Impacts in Japan

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  • Fumio Ohtake

    ()
    (Institute of Social and Economic Research, Osaka University)

  • M. Kohara
  • N. Okuyama
  • K. Yamada

Abstract

Inequality has widened continuously since the 1980s in Japan. The widening gap between the haves and have-nots has been driven by different factors in each given period. Ohtake and Saito (1998) argue that inequality in the 1980s and 1990s can be explained mainly by population aging. Dispersions of income, consumption expenditure, and wealth within the age group increase among the elderly, so an increase in older people leads to a rise in income inequality across the entire country. The growing income and wealth inequalities observed in the UK and the US since the 1980s are characterized by a widening income gap due to educational attainment and an increase in the incomes of higher income groups (Autor, Katz, and Kerney, 2006; Lemieux, 2006; Piketty and Saez, 2006). In contrast, in Japan, wage inequality due to educational attainment has remained relatively stable over the period 1980-1990. This does not mean that skill-based technological change (SBTC) has not substantially affected Japan over time. Kawaguchi and Mori (2008) showed that both the demand and supply for skilled workers have increased because of the SBTC, a rise in the number of college-educated workers induced by educational policy changes, and the aging of the population. Because the shifts in demand and supply are similar, the effects of the shifts on the skill price were canceled out. Thus, the skill price has been stable. They pointed out that the industries that experienced rapid computerization also experienced an upgrading of the skills of workers.

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Bibliographic Info

Paper provided by AIAS, Amsterdam Institute for Advanced Labour Studies in its series GINI Country Reports with number japan.

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Date of creation: Apr 2013
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Handle: RePEc:aia:ginicr:japan

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  1. KAWAGUCHI Daiji & MORI Yuko, 2009. "Is Minimum Wage an Effective Anti-Poverty Policy in Japan?," Discussion papers 09032, Research Institute of Economy, Trade and Industry (RIETI).
  2. Nao Sudo & Michio Suzuki & Tomoaki Yamadai, 2012. "Inequalities in Japanese Economy during the Lost Decades," CARF F-Series, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo CARF-F-284, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo.
  3. Hiroya Kawashima, 2012. "Labor Markets, Poverty and Crime," OSIPP Discussion Paper 12J007, Osaka School of International Public Policy, Osaka University.
  4. Chiaki Moriguchi & Emmanuel Saez, 2008. "The Evolution of Income Concentration in Japan, 1886-2005: Evidence from Income Tax Statistics," The Review of Economics and Statistics, MIT Press, vol. 90(4), pages 713-734, November.
  5. Moriguchi, Chiaki, 2010. "Top wage incomes in Japan, 1951-2005," Journal of the Japanese and International Economies, Elsevier, vol. 24(3), pages 301-333, September.
  6. Thomas Lemieux, 2006. "Postsecondary Education and Increasing Wage Inequality," American Economic Review, American Economic Association, vol. 96(2), pages 195-199, May.
  7. Fumio Ohtake & Miki Kohara, 2010. "The relationship between unemployment and crime:evidence from time-series data and prefectural panel data," OSIPP Discussion Paper 10J007, Osaka School of International Public Policy, Osaka University.
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