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Measuring Human Capital in Japan

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  • MIYAZAWA Kensuke

Abstract

This paper measures human capital development in the Japanese workforce after WWII. An increase in workers' years of schooling is believed to have aided Japan's economic growth after WWII. The development of human capital has acquired increasing importance for Japan's future economic growth given its aging population. To quantify these historical and forward-looking contributions of human capital, we construct a dataset that incorporates the distribution of workers' years of schooling by employing data covering workers and students. We transform years of schooling into a measure of human capital by using a nonlinear Mincer-type wage function. We find that workers' average years of schooling increased dramatically during the 1950s and 1960s. While this increase in human capital could explain much of Japan's economic growth during these decades, education policies have limited prospects for contributing to Japan's future economic growth.

Suggested Citation

  • MIYAZAWA Kensuke, 2011. "Measuring Human Capital in Japan," Discussion papers 11037, Research Institute of Economy, Trade and Industry (RIETI).
    • Handle: RePEc:eti:dpaper:11037
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    References listed on IDEAS

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    1. Fumio Hayashi & Edward C. Prescott, 2004. "The 1990s in Japan: a lost decade," Chapters, in: Paolo Onofri (ed.), The Economics of an Ageing Population, chapter 2, Edward Elgar Publishing.
    2. Esteban-Pretel, Julen & Sawada, Yasuyuki, 2014. "On the role of policy interventions in structural change and economic development: The case of postwar Japan," Journal of Economic Dynamics and Control, Elsevier, vol. 40(C), pages 67-83.
    3. Kobayashi, Keiichiro & Inaba, Masaru, 2006. "Business cycle accounting for the Japanese economy," Japan and the World Economy, Elsevier, vol. 18(4), pages 418-440, December.
    4. Peter J. Klenow & Mark Bils, 2000. "Does Schooling Cause Growth?," American Economic Review, American Economic Association, vol. 90(5), pages 1160-1183, December.
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