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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 the 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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  • Agnese, Pablo & Sala, Hector, 2009. "The fading 1990s in Japan: Driving forces behind the unemployment upsurge," International Review of Economics & Finance, Elsevier, vol. 18(3), pages 428-439, June.
    • Handle: RePEc:eee:reveco:v:18:y:2009:i:3:p:428-439
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    Cited by:

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    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;

    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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