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The fading 1990s in Japan: Driving forces behind the unemployment upsurge

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  • Agnese, Pablo
  • Sala, Hector

Abstract

This paper sheds new light on the causes of the unemployment upsurge in Japan during the “fading 1990s”, an unprecedented period of structural crisis. We estimate a labor market model and identify the main macroeconomic determinants of labor demand and labor supply decisions in last decades. We then conduct dynamic simulations and assess the relative contribution of these determinants to the evolution of unemployment from 1990 to 2002. Beyond the leading role exerted by the decline in productivity growth, we find the active and expansionary measures undertaken by the government had an overall negative effect on the labor market.

Suggested Citation

  • Agnese, Pablo & Sala, Hector, 2008. "The fading 1990s in Japan: Driving forces behind the unemployment upsurge," MPRA Paper 16501, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:16501
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    Cited by:

    1. Marika Karanassou & Hector Sala, 2010. "Labour Market Dynamics in Australia: What Drives Unemployment?," The Economic Record, The Economic Society of Australia, vol. 86(273), pages 185-209, June.
    2. Pablo Agnese & Pablo Salvador, 2012. "More alike than different: the Spanish and Irish labour markets before and after the crisis," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 1(1), pages 1-24, December.
    3. Carl R. Chen & Weiyu Guo & Nicholas S.P. Tay, 2010. "Are Member Firms of Corporate Groups Less Risky?," Financial Management, Financial Management Association International, vol. 39(1), pages 59-82, March.
    4. Agnese, Pablo, 2009. "Japan and her dealings with offshoring: An empirical analysis with aggregate data," MPRA Paper 16505, University Library of Munich, Germany.
    5. Jiang, Shi-jie & Nieh, Chien-Chung, 2012. "Dynamics of underwriting profits: Evidence from the U.S. insurance market," International Review of Economics & Finance, Elsevier, vol. 21(1), pages 1-15.

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    More about this item

    Keywords

    Japan; unemployment; productivity; macroeconomic policies; chain reaction theory;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General

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