Chapter

The Dual Labour Market Hypothesis and the Japanese Labour Market

Tsuneo Ishikawa

in Income and Wealth

Published in print February 2002 | ISBN: 9780198288626
Published online November 2003 | e-ISBN: 9780191596469 | DOI: http://dx.doi.org/10.1093/019828862X.003.0006
 The Dual Labour Market Hypothesis and the Japanese Labour Market

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What kind of contribution will the theories developed so far make to an understanding of the working of the labour market? From among the various important topics concerning the Japanese labour market, this chapter focuses on its dualistic structure, which has for years caught the attention of many researchers. The chapter consists of two sections. Section 6.1 reviews the meaning of the dualistic wage structure in Japan, and discusses the theoretical rationale for its emergence. Section 6.2 is devoted to an empirical test of whether the entry fee/bond mechanism believed to have the role of removing the entry barrier to the internal labour market actually operated in Japan, by examining the cohort wage profiles of male new school graduates and their movement over time––the supposition being that, if such a mechanism were ever to operate, it would do so by way of generating a seniority wage element that would necessarily be anti‐cyclical in nature. The focus is placed on the new school graduates market because it is the principal port of entry into the internal labour market in Japan, and has previously been regarded as a very competitive one.

Keywords: dual labour market; entry barrier; graduates; internal labour market; Japan; seniority

Chapter.  20137 words.  Illustrated.

Subjects: Public Economics

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