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Temporary Jobs and Globalization: Evidence from Japan

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  • MACHIKITA Tomohiro
  • SATO Hitoshi

Abstract

Since the 1990s, there has been a rapid increase in the proportion of temporary workers in the Japanese workforce. This paper empirically explores a linkage between the shift from permanent to temporary workers in the Japanese manufacturing sector and economic globalization, using various industry level data. We find that FDI and/or outsourcing tend to encourage the replacement of permanent workers with temporary workers in home production. In addition, we find that industries with higher exports are the most aggressive in replacing permanent workers with temporary workers. However, some other measures of global market competition such as world share of value added are not always statistically significant. Our estimation suggests that the impact of these globalization channels is sizable relative to the impact of the Worker Dispatching Act in 2004.

Suggested Citation

  • MACHIKITA Tomohiro & SATO Hitoshi, 2011. "Temporary Jobs and Globalization: Evidence from Japan," Discussion papers 11029, Research Institute of Economy, Trade and Industry (RIETI).
    • Handle: RePEc:eti:dpaper:11029
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    File URL: https://www.rieti.go.jp/jp/publications/dp/11e029.pdf
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    References listed on IDEAS

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    1. Gilles Saint-Paul, 1997. "Dual Labor Markets: A Macroeconomic Perspective," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262193760, April.
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    Cited by:

    1. Ms. Chie Aoyagi & Mr. Giovanni Ganelli, 2013. "The Path to Higher Growth: Does Revamping Japan’s Dual Labor Market Matter?," IMF Working Papers 2013/202, International Monetary Fund.
    2. International Monetary Fund, 2013. "Japan: Selected Issues," IMF Staff Country Reports 2013/254, International Monetary Fund.
    3. Aoyagi, Chie & Ganelli, Giovanni, 2015. "Does revamping Japan's dual labor market matter?," Economic Systems, Elsevier, vol. 39(2), pages 339-357.
    4. Andrea F. Presbitero & Matteo G. Richiardi & Alessia A. Amighini, 2015. "Is labor flexibility a substitute to offshoring? Evidence from Italian manufacturing," International Economics, CEPII research center, issue 142, pages 81-93.
    5. Ji-Whan Yun, 2016. "The Setback in Political Entrepreneurship and Employment Dualization in Japan, 1998–2012," British Journal of Industrial Relations, London School of Economics, vol. 54(3), pages 473-495, September.

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