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Did Government Intervention on Firm’s Employment Policies Have an Effect on the Employment of Elderly Workers?

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  • Nishimura, Yoshinori

Abstract

This paper analyzes whether government intervention on firms’ employment policies have an effect on the employment of the elderly. As a result of the pensionable age increasing in Japan, this policy makes a di↵erence between the mandatory retirement age and the pensionable age. The Japanese government has obliged firms to employ elderly workers until they reach the pensionable age. According to literature, the labor force participation rate of elderly male workers increased after the implementation of this policy. However, according to this paper’s results, after omitting the unobserved heterogeneity and controlling for worker demographics, there is no effect on the employ- ment of the elderly workers. Consequently, this paper discusses why the government intervention in the demand side of the elderly labor market has no effect on elderly employment. According to this discussion, it is possible that a firm avoids the costs from employing the elderly by using measures that are not illegal, while following the directives of the law.

Suggested Citation

  • Nishimura, Yoshinori, 2016. "Did Government Intervention on Firm’s Employment Policies Have an Effect on the Employment of Elderly Workers?," MPRA Paper 73444, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:73444
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    References listed on IDEAS

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    3. Lang, Kevin, 1989. "Why was there mandatory retirement?," Journal of Public Economics, Elsevier, vol. 39(1), pages 127-136, June.
    4. Ayako Kondo, 2016. "Effects of increased elderly employment on other workers’ employment and elderly’s earnings in Japan," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-23, December.
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    8. Staubli, Stefan & Zweimüller, Josef, 2013. "Does raising the early retirement age increase employment of older workers?," Journal of Public Economics, Elsevier, vol. 108(C), pages 17-32.
    9. Richard W. Johnson & David Neumark, 1997. "Age Discrimination, Job Separations, and Employment Status of Older Workers: Evidence from Self-Reports," Journal of Human Resources, University of Wisconsin Press, vol. 32(4), pages 779-811.
    10. Ayako Kondo & Hitoshi Shigeoka, 2013. "The Effectiveness of Government Intervention to Promote Elderly Employment: Evidence from Elderly Employment Stabilization Law," Working Papers e61, Tokyo Center for Economic Research.
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    More about this item

    Keywords

    government intervention; labor market; social security;

    JEL classification:

    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J7 - Labor and Demographic Economics - - Labor Discrimination
    • K2 - Law and Economics - - Regulation and Business Law

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