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Choice of Technology and Labour Market Consequences: An Explanation of U.S.-Japanese Differences

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  • Morita, Hodaka

Abstract

This paper provides an explanation for U.S.-Japanese differences concerning continuous process improvement, turnover rate, and the level and firm-specificity of human capital accumulation. Connection between continuous process improvement and the firm-specificity of training causes multiplicity of equilibria. In the Japanese equilibrium, each firm conducts continuous process improvement because other firms do so, and as a consequence training provided by such a firm becomes less effective in other firms. This lowers the turnover rate, which, in turn, increases firms' incentives to train employees. In the US equilibrium, training is general, which raises the turnover rate and decreases incentives to train.

Suggested Citation

  • Morita, Hodaka, 2001. "Choice of Technology and Labour Market Consequences: An Explanation of U.S.-Japanese Differences," Economic Journal, Royal Economic Society, vol. 111(468), pages 29-50, January.
    • Handle: RePEc:ecj:econjl:v:111:y:2001:i:468:p:29-50
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    Citations

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    Cited by:

    1. Kambayashi, Ryo & Kato, Takao, 2012. "Good Jobs, Bad Jobs, and the Great Recession: Lessons from Japan's Lost Decade," IZA Discussion Papers 6666, Institute of Labor Economics (IZA).
    2. Ishida, Junichiro, 2005. "Lifetime employment as a coordination failure," Japan and the World Economy, Elsevier, vol. 17(2), pages 209-222, April.
    3. Tsuru, Tsuyoshi & Nakajima, Kentaro, 2012. "Product Architecture and Human Resource Management: Comparing Japanese, Chinese, and Korean Firms Based on a Questionnaire Survey," Discussion Paper Series 563, Institute of Economic Research, Hitotsubashi University.
    4. Jed DeVaro & Oliver Gürtler, 2016. "Strategic Shirking: A Theoretical Analysis Of Multitasking And Specialization," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 57(2), pages 507-532, May.
    5. DeVaro, Jed & Farnham, Martin, 2011. "Two perspectives on multiskilling and product-market volatility," Labour Economics, Elsevier, vol. 18(6), pages 862-871.
    6. Michael Waldman, 2012. "Theory and Evidence in Internal LaborMarkets [The Handbook of Organizational Economics]," Introductory Chapters,, Princeton University Press.
    7. Ishida, Junichiro, 2004. "Signaling and strategically delayed promotion," Labour Economics, Elsevier, vol. 11(6), pages 687-700, December.
    8. Hodaka Morita, 2002. "Multiskilling, Delegation, and Continuous Process Improvement: A Comparative Analysis of U.S.-Japanese Work Organizations," Labor and Demography 0207004, University Library of Munich, Germany.
    9. KATO Takao & MIYAJIMA Hideaki & OWAN Hideo, 2016. "Does Employee Stock Ownership Work? Evidence from publicly-traded firms in Japan," Discussion papers 16073, Research Institute of Economy, Trade and Industry (RIETI).
    10. Kato, Takao,, 2016. "Productivity, wages and unions in Japan," ILO Working Papers 994904643402676, International Labour Organization.
    11. Takao Kato & Naomi Kodama, 2018. "The Effect of Corporate Social Responsibility on Gender Diversity in the Workplace: Econometric Evidence from Japan," British Journal of Industrial Relations, London School of Economics, vol. 56(1), pages 99-127, March.
    12. MORITA, Hodaka & TANG, Cheng-Tao, 2017. "Asset Specificity, Human Capital Acquisition, and Labor Market Competition," Discussion paper series HIAS-E-42, Hitotsubashi Institute for Advanced Study, Hitotsubashi University.
    13. Storz, Cornelia & Riboldazzi, Federico & John, Moritz, 2015. "Mobility and innovation: A cross-country comparison in the video games industry," Research Policy, Elsevier, vol. 44(1), pages 121-137.
    14. KATO Takao & KODAMA Naomi, 2016. "Corporate Social Responsibility and Gender Diversity in the Workplace: Evidence from Japan," Discussion papers 16063, Research Institute of Economy, Trade and Industry (RIETI).
    15. Jonathan R. Peterson, 2023. "Employee bonding and turnover efficiency," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 32(1), pages 223-244, January.
    16. Yijiang Wang, "undated". "Product Market Conditions and Job Design," Working Papers 0402, Human Resources and Labor Studies, University of Minnesota (Twin Cities Campus).
    17. Burdin, Gabriel & Kato, Takao, 2021. "Complementarity in Employee Participation Systems: International Evidence," IZA Discussion Papers 14694, Institute of Labor Economics (IZA).
    18. Hideo Owan, 2004. "Promotion, Turnover, Earnings, and Firm-Sponsored Training," Journal of Labor Economics, University of Chicago Press, vol. 22(4), pages 955-978, October.
    19. Burdin, Gabriel & Kato, Takao, 2021. "Complementarity in Employee Participation Systems," GLO Discussion Paper Series 968, Global Labor Organization (GLO).
    20. Kato, Takao & Owan, Hideo, 2011. "Market characteristics, intra-firm coordination, and the choice of human resource management systems: Theory and evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 80(3), pages 375-396.

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