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

  • Agnese, Pablo
  • Sala, Hector

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.

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File URL: http://mpra.ub.uni-muenchen.de/16501/1/MPRA_paper_16501.pdf
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 16501.

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Date of creation: 19 Mar 2008
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Publication status: Published in International Review of Economics and Finance 3.18(2009): pp. 428-439
Handle: RePEc:pra:mprapa:16501
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