The Lost Decade in the Japanese Labor Market : LaborÃ¢â‚¬â„¢s share and OkunÃ¢â‚¬â„¢s Law
AbstractThe purpose of this study is to reexamine two empirical regularities in the Japanese labor market : the constant labor share and Okun's law. The former law relates to the price of labor in the labor market while the latter is a quantity law; they represent suitable benchmarks for judging the condition of the labor market. Although there are more elaborate statistical techniques, these laws are frequently used because they can clarify the macroeconomic situation at a glance. First, a constant labor share is implied in theory by the CobbDouglas production function. Thus, labors share should be based on the production function. Labors share based on income has only been rising because of massive depreciation. Secondly, there have been several structural breaks in Okun's law since the bubble collapsed, and the potential growth rate has fallen.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by East Asian Bureau of Economic Research in its series Labor Economics Working Papers with number 22317.
Date of creation: Jan 2006
Date of revision:
Contact details of provider:
Postal: JG Crawford Building #13, Asia Pacific School of Economics and Government, Australian National University, ACT 0200
Web page: http://www.eaber.org
More information through EDIRC
labor share; Okun's law;
Find related papers by JEL classification:
- J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
- J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gomme, Paul & Greenwood, Jeremy, 1995.
"On the cyclical allocation of risk,"
Journal of Economic Dynamics and Control,
Elsevier, vol. 19(1-2), pages 91-124.
- Gomme, P. & Greenwood, J., 1992. "On the Cyclical Allocation of Risk," UWO Department of Economics Working Papers 9205, University of Western Ontario, Department of Economics.
- Gomme, P. & Greenwood, J., 1993. "On the Cyclical Allocation of Risk," RCER Working Papers 355, University of Rochester - Center for Economic Research (RCER).
- Paul Gomme & Jeremy Greenwood, 1992. "On the cyclical allocation of risk," Discussion Paper / Institute for Empirical Macroeconomics 71, Federal Reserve Bank of Minneapolis.
- Cadiou, Loic & Dees, Stephane & Laffargue, Jean-Pierre, 2003.
"A computational general equilibrium model with vintage capital,"
Journal of Economic Dynamics and Control,
Elsevier, vol. 27(11-12), pages 1961-1991, September.
- Cadiou, Loı̈c & Dées, Stéphane & Laffargue, Jean-Pierre, 2003. "A computational general equilibrium model with vintage capital," Journal of Economic Dynamics and Control, Elsevier, vol. 27(11), pages 1961-1991.
- Boldrin, Michael & Horvath, Michael, 1995.
"Labor Contracts and Business Cycles,"
Journal of Political Economy,
University of Chicago Press, vol. 103(5), pages 972-1004, October.
- Michele Boldrin & Michael Horvath, 1994. "Labor Contracts and Business Cycles," Discussion Papers 1068, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Boldrin, Michele & Horvath, Michael, . "Labor contracts and business cycles," Open Access publications from Universidad Carlos III de Madrid info:hdl:10016/3905, Universidad Carlos III de Madrid.
- Kessing, Sebastian G., 2003.
"A note on the determinants of labour share movements,"
Elsevier, vol. 81(1), pages 9-12, October.
- Kessing, Sebastian, 2002. "A note on the determinants of labour share movements," Discussion Papers, Research Unit: Market Processes and Governance FS IV 02-30, Social Science Research Center Berlin (WZB).
- Andrew Young, 2004. "Labor's Share Fluctuations, Biased Technical Change, and the Business Cycle," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 7(4), pages 916-931, October.
- Clark, Peter K., 1989. "Trend reversion in real output and unemployment," Journal of Econometrics, Elsevier, vol. 40(1), pages 15-32, January.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shiro Armstrong).
If references are entirely missing, you can add them using this form.