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Globalization and Domestic Operations: Applying the JC/JD method to Japanese manufacturing firms

Author

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  • ANDO Mitsuyo
  • KIMURA Fukunari

Abstract

This paper applies the job creation (JC)/ destruction (JD) method to the micro data of Japanese manufacturing firms and provides a bird's eye portrait of the dynamism of globalizing firms in terms of domestic employment, domestic establishments, domestic affiliates, and trade. It examines gross and net changes in domestic operations and trade by multinational enterprises that expand operations abroad (expanding MNEs), compared with non-expanding MNEs and local firms, in the periods of 1998-2002, 2002-2006, 2006-2008, and 2008-2010. It also conducts the Kolmogorov-Smirnov test to investigate whether the changes in domestic operations and trade by expanding MNEs are larger than those by other firm types. Major findings are the following: (i) gross changes in domestic employment/operations are much larger than net changes, showing restructuring dynamism and firm heterogeneity, (ii) de-industrialization or the shrinkage of the manufacturing sector is not salient except for 1998-2002 although a slight declining trend in manufacturing activities has been observed recently, (iii) expanding multinational small and medium enterprises (SMEs) tend to enlarge domestic employment/operations, compared with other types of SMEs, (iv) expanding MNEs intensify headquarters activities, probably within international production networks, and (v) expanding multinational SMEs are likely to expand exports and imports more than other types of SMEs, suggesting active operations in international production networks particularly in East Asia.

Suggested Citation

  • ANDO Mitsuyo & KIMURA Fukunari, 2015. "Globalization and Domestic Operations: Applying the JC/JD method to Japanese manufacturing firms," Discussion papers 15010, Research Institute of Economy, Trade and Industry (RIETI).
  • Handle: RePEc:eti:dpaper:15010
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    File URL: https://www.rieti.go.jp/jp/publications/dp/15e010.pdf
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    References listed on IDEAS

    as
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    6. MATSUURA Toshiyuki, 2013. "Why Did Manufacturing Firms Increase the Number of Non-regular Workers in the 2000s? Does international trade matter?," Discussion papers 13036, Research Institute of Economy, Trade and Industry (RIETI).
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    Cited by:

    1. repec:tpr:asiaec:v:16:y:2017:i:2:p:126-139 is not listed on IDEAS
    2. LIU Yang, 2017. "Effects of Wages and Job Productivity on Job Creation and Destruction: Evidence from Japanese division-level employment data," Discussion papers 17060, Research Institute of Economy, Trade and Industry (RIETI).
    3. Hyunbae Chun & Jung Hur & Young Gak Kim & Hyeog Ug Kwon, 2017. "Cross-border Vertical Integration and Intra-firm Trade: New Evidence from Korean and Japanese Firm-level Data," Asian Economic Papers, MIT Press, vol. 16(2), pages 126-139, Summer.
    4. repec:eee:asieco:v:58:y:2018:i:c:p:59-71 is not listed on IDEAS
    5. repec:tpr:asiaec:v:16:y:2017:i:2:p:187-209 is not listed on IDEAS
    6. LIU Yang & NI Bin, 2018. "Outward Foreign direct investment and Firm-level Employment Dynamics in Japanese Manufacturing Firms," Discussion papers 18069, Research Institute of Economy, Trade and Industry (RIETI).

    More about this item

    JEL classification:

    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • F60 - International Economics - - Economic Impacts of Globalization - - - General
    • F66 - International Economics - - Economic Impacts of Globalization - - - Labor

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