This paper aims at finding out how the shareholder-value pursuit has affected labor policies at large Japanese listed enterprises. It concentrates on the issue of labor bifurcation, whereby the proportion of nonregular employees has grown rapidly over the last two decades, currently approaching the numbers of regular employees.In Japan, corporate governance reforms became key to structural macroeconomic changes according to the 2013 "Japan Revitalization Strategy" formulated by the Cabinet Office. This document mandated the creation of the JPX-Nikkei Index 400 -an index called to accommodate the most investor-friendly joint-stock companies. The move towards a shareholder model has been further reinforced through a rapid surge in foreign stockholding that started during the post-bubble period of the mid-1990s. At the same time, the externalities of increased returns to stockholders have been the changes in the related domains of management and labor, which I explain through the application of the political economic theory. This theory underlines the importance of inclusion into a "political bloc" for being eligible for economic benefits. Consequently, I argue that increased returns to politically privileged shareholders have been achieved at the expense of a growing proportion of unprivileged nonregular employees.The evidence yields support to the argument about the positive correlation between shareholder value and the proportion of nonregulars. On the other hand, foreign stockholding does not appear to be significantly correlated with the increase in nonregular employment. In turn, the study has found that the proportion of nonregular employees is significantly correlated with domestic ownership that characterizes higher managerial entrenchment.
This paper examines the market perception of corporate innovations in Japan. It follows the research question formulated by Hall, Jaffe, and Trajtenberg (2005): "how does innovative activity translate into market value, and what aspects of the underlying process are captured by the empirical measures available?". The novelty of my study is twofold. First, it embraces the longitudinal innovation- and finance-related corporate records to come up with the largest ever combined data-set for Japan that encompasses 632 companies listed at the Tokyo Stock Exchange over the period of 19 years. Second, in addition to linear regressions, it applies the generalized additive models (GAMs). The latter technique allows for realistically capturing nonlinear patterns present in the data while at the same time retaining predictive features of a model. The main finding of the article is following. Amid the dominant role of research and development (R&D), especially for the Pharmaceutical and Chemical industries, market consistently rewards influential patents in the manufacturing sector.
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