Bonus and Employment in Small Firms : Reconsideration of Share Economy

Abstract

As one reason for the low unemployment rate after oil shocks in Japan, the structual differences in earnings by enterprise size are considered. During the 1970s and 1980s, Japanese small firms had relatively large labor demand. This is because the bonus payments in these flrms were more likely to be in form of profit sharing. Empirical tests show that in Japanese small manufacturing firms bonus payments had been determined differently from monthly wage payments, In particular, almost the half proportion of the bonus payment was the profit sharing segment there

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