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Intertemporal Substitution and Labor Supply in Japan

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  • Richard Beason

Abstract

This paper considers whether Japanese labor market data are consistent with the intertemporal substitution hypothesis. The Japanese labor market data are first tested for broad conformity with the hypothesis using the methodology of Ashenfelter and Card (1982). The results from this analysis are encouraging. Next, the hypothesis is tested using the methodology of Altonji (1982). The results from this analysis are not generally favorable to the hypothesis. Finally, an ad hoc test of whether the bonus should be considered a form of wage payment is nested in the test of the intertemporal substitution hypothesis, with the result that the bonus does not appear to elicit the same labor supply behavior as the base wage.

Suggested Citation

  • Richard Beason, 1992. "Intertemporal Substitution and Labor Supply in Japan," Journal of Human Resources, University of Wisconsin Press, vol. 27(3), pages 511-5330.
    • Handle: RePEc:uwp:jhriss:v:27:y:1992:i:3:p:511-5330
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    Cited by:

    1. Beason, Dick & Gordon, Ken & Mehrotra, Vikas & Watanabe, Akiko, 2008. "Does Restructuring Pay in Japan? Evidence Following the Lost Decade," CEI Working Paper Series 2008-16, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
    2. Yamada, Ken, 2011. "Labor supply responses to the 1990s Japanese tax reforms," Labour Economics, Elsevier, vol. 18(4), pages 539-546, August.
    3. Beason, Dick & Gordon, Ken & Mehrotra, Vikas & Watanabe, Akiko, 2009. "Does Restructuring Pay in Japan? Evidence Following the Lost Decade," CEI Working Paper Series 2008-16_v2, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
    4. Beason, Dick & Gordon, Ken & Mehrotra, Vikas & Watanabe, Akiko, 2009. "Does Restructuring Pay in Japan? Evidence Following the Lost Decade," CEI Working Paper Series 2008-20_v2, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
    5. Beason, Dick & Gordon, Ken & Mehrotra, Vikas & Watanabe, Akiko, 2009. "Does Restructuring Pay in Japan? Evidence Following the Lost Decade," CEI Working Paper Series 2008-20, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.

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