Financial Distress and Employment: The Japanese Case in the 90s

33 Pages Posted: 27 Apr 2003 Last revised: 11 Nov 2022

See all articles by Kazuo Ogawa

Kazuo Ogawa

Osaka University - Institute of Social and Economic Research (ISER)

Date Written: April 2003

Abstract

We examine quantitatively the extent to which financial distress in the 1990s affected employment behavior in Japan. Based on the firm-level panel data that include small firms, we estimate dynamic labor demand function, taking the impact of financial distress on employment into consideration. We find that the firm's ratio of debt to total asset exerts a significantly negative effect on employment of small firms. We also find that employment of small firms is sensitively affected by lending attitude of financial institutions.

Suggested Citation

Ogawa, Kazuo, Financial Distress and Employment: The Japanese Case in the 90s (April 2003). NBER Working Paper No. w9646, Available at SSRN: https://ssrn.com/abstract=398550

Kazuo Ogawa (Contact Author)

Osaka University - Institute of Social and Economic Research (ISER) ( email )

6-1 Mihogaoka
Ibaraki, Osaka 567-0047
Japan
+81 6 6879 8570 (Phone)

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