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How did the Japanese Employment System Change?Investigating the Heterogeneity of Downsizing Practices across Firms

Sebastien Lechevalier (), Cyrille Dossougoin (), Christophe Hurlin () and Satoko Takaoka
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Satoko Takaoka: Kobe University

No 883, KIER Working Papers from Kyoto University, Institute of Economic Research

Abstract: Beyond the general issue of institutional change at the aggregate level, some studies have shown that the diversity of Japanese firms has increased since the late 1990s, both in terms of performance and organization. This paper contributes to this literature by investigating the evolving employment practices at the firm level. In mobilizing a database of listed manufacturing firms, we focus on the evolution of the speed of downsizing between the 1990s and the 2000s. A specificity of our paper is that we do not limit our analysis to the introduction of individual effects but we rather resort to a Bayesian estimation procedure, which yields to (firm-specific) individual forecasts of the parameters of the adjustment process modelled with random coefficients. The first major result we get is a decreasing average speed of downsizing, contrary to what is found in a simple estimation with individual effects. Second, we confirm the increasing heterogeneity of Japanese firms between the 1990s and the 2000s, through a rising dispersion of the speed of downsizing. Third, we are able, from a descriptive viewpoint to identify some characteristics of firms with different speed of downsizing.

Keywords: Corporate; Heterogeneity.; Japanese; Employment; System.; Speed; pf; Employment; Adjustment.; Downsizing.; Panel.; Random; coefficient; model.; Bayesian; estimation (search for similar items in EconPapers)
JEL-codes: C23 G30 J23 L20 L63 L68 (search for similar items in EconPapers)
Pages: 43pages
Date: 2014-01
New Economics Papers: this item is included in nep-bec and nep-lab
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