Trends in Worker Displacement Penalties in Japan: 1991-2005

39 Pages Posted: 17 Aug 2007

See all articles by Michael L. Bognanno

Michael L. Bognanno

Temple University - Department of Economics; IZA Institute of Labor Economics

Ryo Kambayashi

Hitotsubashi University

Date Written: July 2007


We examine the period from 1991 to 2005 to document the effects of a changing Japanese labor market on trends in the cost of job change. During this period, job change penalties and the extent to which they were age-related grew. Evidence is also found of a diminishing specificity in human capital (in industry, occupation and firm size) for job changers in the Japanese labor market. As might be expected, older workers and workers leaving the largest firms suffered the largest wage losses from job change. Older workers were also harmed more by involuntary job separations. In percentage terms, young females have larger wage losses than young males but older females have smaller losses than older males. This pattern is masked in considering only the overall effect of gender on the cost of job change.

Keywords: job displacement, Japan

JEL Classification: J31, J41, J63, J6

Suggested Citation

Bognanno, Michael L. and Kambayashi, Ryo, Trends in Worker Displacement Penalties in Japan: 1991-2005 (July 2007). IZA Discussion Paper No. 2954, Available at SSRN:

Michael L. Bognanno (Contact Author)

Temple University - Department of Economics ( email )

Philadelphia, PA 19122
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072

Ryo Kambayashi

Hitotsubashi University ( email )

2-1 Naka Kunitachi-shi
Tokyo 186-8601


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