Constraints on the Level and Efficient Use of Labor

Abstract

This chapter addresses impediments to the growth of the labor supply that are affecting the economy. It first outlines the state of Japanese labor in 2001, focusing on the extent to which institutions long seen as characteristic of the Japanese labor market have stayed the same or have been changing. The chapter then discusses labor law and its consequences. Next, it looks at impediments to the mobility of career employees (primarily men) that may be affecting growth and examines reasons why female labor-force participation may be lower than levels seen in the United States. A quantitative perspective of the barriers is presented, including their overall implications for economic growth; the role of government policy in removing the barriers is considered; and some areas in need of further research are identified.

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