2019/11/12 by Izumi Yokoyama, Kazuhito Higa, Daiji Kawaguchi · 1 voice
Economics, Econometrics and Finance · #Economic Policies and Impacts #Firm Innovation and Growth #Global trade and economics
paper · doi:10.1177/0019793919887961
openalex publication_date 2019/11/12 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/22
The authors investigate the adjustments in employment of regular and non-regular workers, exploiting the exchange-rate fluctuation and heterogeneous dependence on international trade across firms as a source of exogenous variation. An analysis of panel data of Japanese manufacturers reveals that the appreciation of the Japanese yen spontaneously decreased the sales of exporters and the employment of non-regular workers, but it did not reduce the employment of regular workers. This finding provides support for the claim that firms are likely to adjust the employment of non-regular workers to absorb exogenous shocks and to insulate regular workers from the shocks in an uncertain business environment. In exploring the mechanism driving these results, the authors also find that exporters use the employment of non-regular workers and wages of regular workers as adjustment margins for the exchange-rate fluctuation to hoard regular workers, who presumably hold higher levels of firm-specific human capital.