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Since the burst of the bubbly economy in the early 1990s, changes in pay practices of Japanese firms have received increased attention both in Japanese academia and the popular media. The focus point of attention has been to what extent the hitherto predominately seniority related compensation practices are being replaced by more performance-based salary systems and what kind of problems are associated with such changes.
Seniority-based pay (nenkō joretsu chingin) has often been described as one of the so-called 'three pillars of the Japanese employment system'; the two others being lifetime employment (shūshin koyō) and in-house company unions (kigyōbetsu kumiai). Just as many other features of the Japanese economic system it has recently come under increased scrutiny and has been criticized for being too costly and ill-suited to motivate and retain workers in the fast-changing business environment. Given the high dominance of this compensation practice so far, any changes have a high significance for our understanding of contemporary Japanese management practices.
There are already a number of important Japanese studies about recent changes in pay practices, and I have also conducted research and published in this area. However, one aspect of recent pay reforms which remains under-researched is the relationship between corporate pension and pay system reform. Since retirement benefits make up a substantial part of overall employees' compensation, a full understanding of the on-going pay reforms requires more knowledge about how changes in pension legislation since the early 2000s have influenced the provision of corporate retirement benefits.
The aim of this paper is to address the influence of changes in pension legislation in the early 2000s on the provision of corporate retirement benefits. Today, well over 80 per cent of Japanese companies have some sort of retirement benefit plan, and most big companies pay pensions as well as lump-sum benefits. With regard to the number of participants and the amount of assets under management, by far the most important occupational pension schemes have so far been defined benefit (DB) plans. These plans are employer-sponsored retirement schemes where final payouts are linked to employment tenure and the development of wages over time. The significant point is that these plans have a similar incentive structure as seniority-based wages because the benefits are directly linked to employment tenure and rise progressively over time.
With the last occupational pension reform enacted in October 2001 and April 2002, employers were given new options for company pension plans, most significantly so-called Japanese-style 401(k) defined contribution (DC) plans. These new plans have no longer a seniority-oriented incentive structure and the investment risks are born by employees. Against the background of these new legal options, a number of questions arise which will be tackled in this paper:
- How have companies utilized the new options in the reform of their pay systems?
- What are the interactions between corporate pension and pay system reforms? Specifically, how have changes in corporate governance (for example in terms of shareholder influence) and the labour unions impacted the restructuring of corporate pension systems?
- Are there significant differences among different sectors or between corporate groups and independent companies?
- What are the likely effects of the current global financial crisis?
Methodologically, this research is based on the analysis of secondary statistical data and primary data gained through semi-structured interviews with Japanese pension experts, human resource managers, labour union officials, academics, and bureaucrats in April 2009.
The purpose of this paper is to take stock of the social science literature on the East Asian welfare regime that has come around over the last decade or so. It suggests the concepts of the welfare triangle and the welfare diamond as a theoretical framework and then proceeds to discuss the development in Japan and Korea in separate sections, mainly highlighting the significant changes that have taken place, including the demise of life long (male) employment and company welfare and the concomitant increase in public social welfare that took place with democratization. Some elements of continuity are also pointed out such as the important role of state bureaucracies and of land reform. The following section engages with the comparative social policy literature in sub-sections. First few country comparisons of
This paper explores the nature of the newly emerging welfare state in
Many experts have debated about the characteristics of the social policy reform. Some scholars maintain that the reform aimed at promoting social solidarity and resulted in an increased state involvement in social welfare provision. Yet, some critics have argued that the government implemented a labor market reform which led to employment insecurity and that the social security expansion was essentially a subsidiary tool for the labor market reform. Some of them characterize the emerging welfare state as neo-liberal. Others call it a productivist welfare capitalism.
This paper analyzes labor market changes during the past decades and finds that this criticism is not consistent with available evidence. The number of workers in non-regular employment has been rapidly increasing, as the critics indicated. Many low-income families have not gained many benefits from the reformed social security system due to the unsecure employment status. It is found, however, that non-regular, low-wage workers have been increasing not due to a neo-liberal labor market reform, but due to the labor market duality. The dual labor market, characterized by the coexistence of overprotected regular workers and under-protected non-regular workers, is a legacy of the authoritarian developmental state during the industrialization period.
This paper concludes that a western welfare state strategy mainly relying on universalistic social insurance systems may not be so effective in protecting disadvantaged families in
Holliday (2000) proposed a model called 'productivist welfare capitalism
(PWC),' emphasizing that social policy in East Asia is an important policy
instrument for facilitating economic development rather than protecting
citizens from social contingencies and poverty. However, despite their
similarities as productivist welfare states, a gradual but marked sign of
divergence has emerged in the region, especially since the 1997 Asian
financial crisis. The recent expansion of social protection in some
countries (e.g. South Korea and Taiwan) leads scholars to raise a question
about the usefulness of the concept of PWC. This research sets out to
address this question based on the following two puzzles:
First, is there a systematic variation of productivist welfare state in
East and Southeast Asia? If so, how can we contain their similarities and
differences in a single model? How many clusters can we distinguish under
the productivist framework?
Second, if there is a systematic divergence, what is behind it? What are
the major determinants differentiating the course of productivist welfare
development in the region?
Regarding the first question, this research presents a model derived from
two theoretical dimensions - redistribution and efficiency - and carries
out cluster analysis on 12 countries to verify the existence of three
subcategories of PWC (compensatory, competitive, and mixed). In the second
part, this study examines economic and political variables to identify the
causal configuration that generates the divergence of PWC in East and
Southeast Asia. The main argument is that the type of financial system and
the political regime type play a critical role in formulating the pattern
of social policy development in the region. Based upon annual observations
of public expenditures and institutional platforms of social policy, this
research conducts MLE analysis to test the argument.
According to Japanese social norms the family is expected to be the fundamental support system, even if its members are on intimate terms with each other. In other words, intimacy within the modern Japanese family is assumed and consequently it is demanded that the family will provide support for its members.
As nuclear families replace extended ones, especially in Tokyo, once relationship problems within couples arise, there are often no other adults in the family who can intervene or mediate between the couple. This situation is likely to create further conflict and it is also difficult to seek outside support since it is thought that family problem should to be dealt with inside the family and if made public are a cause of shame. As a consequence of this issue, women often suffer.
Many kinds of mutual aid groups have developed in East Asian countries based on community or blood relations. The wider community which acts like an extended family has a number of well-developed networks which attempt to deal with a range of issues. However, as urbanisation continues, frequent migration and the increasing importance of the nuclear family, means that traditional mutual aid groups no longer perform their roles effectively.
This paper draws on qualitative interview data from women in Tokyo who have experienced mental health difficulties in relation to family issues. It explores the role of social support, especially informal types, in providing help for these women. It concludes by suggesting that alternative types of support within the community need to be developed in order to provide effective support for Japanese women experiencing mental health problems.
Full paper: Kamozawa_2009_family_mental_distress.pdf
This paper draws on a retrospective survey of 498 students in China and 481 in England and follow-up interviews, focusing on their experiences of physical punishment and disciplinary behaviour from mothers and fathers 'while growing up', including how they felt about their experiences and views concerning what might be perceived as 'acceptable' or 'unacceptable' punishments. The paper focuses on the Chinese findings, while the English findings are referred to for comparison and debate. The findings are contextualised and discussed in relation to ongoing debates and policy development concerning children's right to safety. In the past decade in particular, there has been ongoing debate and development of policy in
Amidst endeavors to examine social policies from a gender-sensitive perspective, this study investigated elderly women's economic risks and effectiveness of pension policy in a comparative manner. First, relative poverty risks of elderly female householder of 15 OECD countries in their 1990s were calculated using Luxembourg Income Study dataset. Second, women's pension rights were specified by integrating pension indicators into two separate indices - individual right and derived right. Third, fuzzy-set qualitative comparative analysis (Fs/QCA) was used to analyze the causal relationship between pension rights and economic welfare of elderly women. Control variables such as women's labor market participation rate, social expenditure for the aged and social assistance expenditure (% of total social expenditure) were also considered. As a result, individual rights passed the necessity test for high economic security of elderly female householder while derived right passed the necessity test of the high relative poverty risk of elderly female householder (benchmark proportion of .65, p<0.05). In the sufficient test, countries with "high individual right and low derived right" usually showed high economic security of elderly female householders. In addition, "low individual right and high derived right" joined with one of "high women's economic activity, low relative public spending on the elderly or low relative social assistance expenditure" were revealed as the causal combinations sufficient for the relative poverty risk. These conclusions suggest that pension policies developing individual rights, rather than derived rights, would have more resilience on elderly women's economic risk from a comparative perspective.
Full paper: Kim_S-W_2009_womens_economic_risk.pdf
This study aims to employ focus group method to develop the Poverty and Social Exclusion Survey questionnaire in
[*] PSETPS is funded by British-Taiwanese Joint Projects between the
Old-age insecurity has become one of the most important social issues in two emerging welfare states, namely