Top Wage Incomes in Japan, 1951-2005

41 Pages Posted: 10 Dec 2008 Last revised: 22 Sep 2010

See all articles by Chiaki Moriguchi

Chiaki Moriguchi

Hitotsubashi University - Institute of Economic Research

Date Written: December 2008

Abstract

Using wage income tax statistics, we construct continuous series of upper wage income shares in Japan from 1951 to 2005 to document the evolution of top wage incomes and investigate their long-run determinants. We find that, while the middle wage income class gained enormously both in absolute and relative terms during the period of high economic growth, the upper wage income class faired comparatively better after 1975. In particular, the share of total wage accruing to the top 1% wage earners has risen steadily in the last ten years. Using a simple time-series regression analysis, we find that marginal income tax rates, corporate performance, female labor participation, and labor disputes are important determinants of top wage income shares in post-WWII Japan. Although not conclusive, our results suggest that much of the recent gains in wage income shares at the top can be explained by the changes in these four factors, placing a less emphasis on a story of structural change.

Suggested Citation

Moriguchi, Chiaki, Top Wage Incomes in Japan, 1951-2005 (December 2008). NBER Working Paper No. w14537. Available at SSRN: https://ssrn.com/abstract=1312630

Chiaki Moriguchi (Contact Author)

Hitotsubashi University - Institute of Economic Research ( email )

2-1 Naka Kunitachi-shi
Tokyo 186-8306
Japan

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