Ken Yamada
Abstract
Classified broadly, two motives for intra-family transfers exist: altruism and selfishness. This paper examines two selfish hypotheses - the exchange motive (strategic bequest motive) and the demonstration effect - using a new Japanese micro data set. My analysis of the determinants of intergenerational co-residence, distance between residences, and frequency of contact yields considerable support for the exchange motive but no support for the demonstration effect. The findings are consistent with the exchange motive after distinguishing it from mutual altruism.
Ken Yamada
Abstract
The consumption-leisure choice model implies that an exogenous change in tax rates will bring about a change in labor supply. This implication is expected to be important to labor supplied by secondary earners under a progressive tax system when spousal income alters effective marginal tax rates. This paper examines labor supply responses to the income tax changes associated with Japanese tax reforms during the 1990s. Empirical specifications are presented in a way that is consistent with a life-cycle model of consumption and labor supply. A simple solution is applied to the sample-selection problem in panel data models with endogenous regressors. The results indicate that the hours-of-work elasticity with respect to the net-of-tax rate is 0.8 for married women.
Daiji Kawaguchi and Ken Yamada
Abstract
The statutory minimum wage in Japan is revised every year and increases by almost the same amount across prefectures, regardless of disparities in the wage distribution. Due to this feature of minimum-wage setting, the minimum wage cuts into the wage distribution in rural Japan. We examine the impact of the minimum wage on employment, focusing on women in their 20s and 30s, who are known to be typical, low-wage workers in Japan. The results, based on a panel estimation, suggest that the minimum wage has a measurable impact on employment; the workers whose current wage is below the revised minimum wage are about 20 to 30 percentage points less likely to be employed in the following year than comparable low-wage workers who are not affected by the revision of the minimum wage. The estimation results are sensitive to the choice of the control group, and this fact suggests the importance of controlling for unobserved heterogeneity regarding the employment probability.
Ken Yamada
Abstract
In a recent book and in a series of papers, Miwa and Ramseyer (2001, 2002a, 2002b, 2002c) challenge prevailing views on the dominating influence of keiretsu and the main-bank system on the Japanese economy. I reinterpret the authors' arguments in the context of a simple regression framework.
Ken Yamada
Abstract
Non-random selection in employment potentially results in misleading estimates of labor market outcomes. In this paper, I estimate sample selection models with endogenous explanatory variables to obtain the compensated wage elasticity of time, and the wage returns to schooling, for married Japanese women. I correct for the possible sample selection bias by using the variation in the employment rates of the sibling structure. I also take into account the potential endogeneity of wage and income variables in the time allocation model and an education variable in the human capital model.
Ken Yamada
Abstract
In this paper, I estimate the uncompensated and compensated wage elasticities, and the income elasticity of time, for married men and unmarried women in Japan. For the purpose of the estimation, I control for the potential endogeneity of the wage and income variables.
Ryo Kambayashi, Daiji Kawaguchi, and Ken Yamada
Abstract
The median wage in Japan has fallen nominally since 1999 due to a severe recession, while the statutory minimum wage has steadily increased over the same period. We used large micro-data sets from two government surveys to investigate how the minimum wage has affected wage distribution under the unusual circumstances of deflation. The compression of the lower tail of female wage distribution was largely explained by the increased real value of the minimum wage. The steady increases in the effective minimum wage reduced employment among low-skilled middle-aged female workers, but the mechanical effect associated with disemployment on wage compression was minimal. These results held even after controlling for composition effects. The minimum wage contributed to the reduction in the pay gap between full-time and part-time workers.
Ken Yamada
Abstract
This paper provides structural estimates of heterogeneous returns to work experience for Japanese married women. A dynamic model of labor force participation is used to account for dynamic self-selection into employment. Heterogeneity is incorporated into the model in a way that allows for the multidimensional skill heterogeneity in employment and home production and for the individual-specific slope and curvature of experience effect on earnings. The structural estimates and their comparison to the reduced-form estimates highlight the importance of dynamic self-selection into employment and heterogeneity in returns to work experience.
Ken Yamada
Abstract
This paper develops a life-cycle model of female decisions on marital and employment status, which is then estimated using a 10-wave panel survey of Japanese women. The share of household budget allocated to an individual is endogenously determined in the structural model. Occupational earnings equations account for the effects of work experience on current earnings, future earnings, marital status, and intra-marital bargaining power. The model’s predictions based on estimated parameters fit the actual data in terms of marital and employment status. The direct information on intra-household allocations is exploited to validate the structural model. A counterfactual policy simulation is finally conducted to quantify the impacts of abolishing the actual tax system and of introducing the Earned Income Tax Credit.
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