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Effects of Fiscal Policy on Employment under the Zero Lower Bound in Japan: An Empirical Investigation with Gender and Regional Heterogeneity

Author

Listed:
  • Tomomi Miyazaki

    (Graduate School of Economics, Kobe University)

  • Haruo Kondoh

    (Faculty of Law, Keio University)

  • Huanhuan Guo

    (School of Business, Sanda University)

  • Naoto Tanemoto

    (Graduate School of Economics, Kobe University/Policy Research Institute, Ministry of Finance, Japan)

Abstract

We examine the effects of fiscal policy on employment when short-term interest rates were stuck at the zero lower bound (ZLB) in Japan. To do this, we consider both gender and regional differences. Our empirical results demonstrate that regardless of specification, government consumption benefited Southern Kanto and Kansai during the ZLB period. We also robustly show that it created jobs for female workers in these two metropolitan areas under the ZLB environment. These results suggest that since employers expect employment recovery by virtue of fiscal expansion as a temporal phenomenon, they increase female employees, most of whom are part-time workers.

Suggested Citation

  • Tomomi Miyazaki & Haruo Kondoh & Huanhuan Guo & Naoto Tanemoto, 2025. "Effects of Fiscal Policy on Employment under the Zero Lower Bound in Japan: An Empirical Investigation with Gender and Regional Heterogeneity," Discussion Papers 2524, Graduate School of Economics, Kobe University.
    • Handle: RePEc:koe:wpaper:2524
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