Cover -- Half-title -- Title -- Copyright -- Dedication -- Contents -- Figures -- Tables -- Preface -- Introduction -- Part I Features of Japan's internal labor markets -- 1 Internal labor markets in search equilibrium -- Overview -- The model -- The choice of vacancies and promotions -- The allocation of firms to internal and occupational labor markets -- OLM firms -- ILM firms -- Wage bargaining and returns from search for unemployed workers -- Search market equilibrium -- Aggregate vacancies -- Labor market equilibrium -- Comparative statics -- Discussion and extensions -- Training externalities -- The complementarity between education and workplace training -- Summary -- Appendix -- Inefficient bargaining -- Finite substitution between the two types of labor -- 2 Demand and supply of skills in a corporate hierarchy -- Overview -- A model of human capital accumulation -- The model -- Maximization of the lifetime net utility of each employee -- Career paths and investment policy -- Career paths and investment policies in ILM and OLM firms -- General equilibrium -- Market equilibrium with ILM and OLM firms -- A numerical example -- Earnings profiles, seniority, talents, and jobs -- Experience, earnings profile, and promotions -- Summary -- Appendix -- Proof of lemma 2.1 -- The V functions -- Proof of lemma 2.2 -- Proof of lemma 2.3 -- Proof of lemma 2.4 -- Wage profiles -- Proof of lemma 2.5 -- 3 Measuring occupational and internal labor markets -- Overview -- Review of the literature -- A measure of the degree of internalization -- Earnings profiles in internal and in occupational labor markets -- Summary -- Appendix List of the 92 occupations -- 4 Earnings and seniority in internal labor markets -- Overview -- Review of the literature -- The empirical relationship between earnings and seniority: Japanese data.

Earnings and seniority in Japan and the United Kingdom -- Summary -- 5 Recruitment and promotion in Japanese firms -- Overview -- A brief review of the literature -- Recruitment and promotion: evidence from individual firm ABO -- The firm -- The data -- The rank system -- Recruitment -- Promotion policy -- Exits -- Econometric analysis -- Firm growth and promotion policy -- Exits and promotion -- Recruitment methods and promotion policy -- Discussion -- Evidence from other firms -- A review of the evidence -- Firm BGH -- Firm IH -- Firm ABO -- Firm IKO -- Discussion -- Summary -- 6 Product market competition and internal labor markets -- Overview -- Inter-industry variations in wages and product market markups -- Data and estimated markups -- Some inter-firm and industry comparisons -- External and internal labor markets -- Interactions with product market competition and firm performance -- Discussion -- Summary -- Appendix The estimation of the markups of prices over marginal costs -- Part II Recent changes in wage and employment structures -- 7 Institutional changes in Japanese internal labor markets -- Overview -- The early 1980s and the bubble years -- Adjustment of the mandatory retirement age -- Reforming hierarchies -- The bubble years and the aftermath -- The effects of ageing and of slower growth -- Institutional changes in the 1990s -- Multiple career tracks -- Accelerated retirement and age limits for managerial positions -- Restructuring compensation -- Summary -- Appendix Case studies from the Rousei Jihou -- Case studies -- Sony: introducing the company system -- Panasonic (Matsushita): front-loading severance pay -- Shin Nippon Steel: way behind, but moving -- 8 Changes in the employment and wage structure of Japanese firms, 1976-1996 -- Overview -- Data and definitions -- Growth deceleration.

Changes in relative wages and spans of control -- Changes in promotion rates -- Summary -- Appendix -- 9 Changes in Japanese earnings profiles -- Overview -- Previous literature -- Data -- Pooled cross-sections -- Cohort data, 1976-1996 -- Summary -- 10 The impact of growth and business cycles on Japanese corporate hierarchies -- Overview -- A model of internal labor markets, incentives, and growth -- Setup -- Growth of the firm and the incentive structure -- Extension I: production efficiency and promotion -- Extension II: cohort effects -- Empirical evidence -- Growth, relative wages, spans of control, and promotion rates -- Cohort effects -- Relative wages and business cycle fluctuations -- Descriptive analysis -- Summary -- Appendix -- Proof of lemma 10.1 -- Proof of lemma 10.2 -- Derivations of the results in table 10.1 -- Effects of an increase in alpha, beta or µ -- Temporary changes in quality and quantity of new recruits -- Epilog -- References -- Author Index -- Subject Index.