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Changing Inequalities and Societal Impacts in Rich CountriesThirty Countries' Experiences$
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Brian Nolan, Wiemer Salverda, Daniele Checchi, Ive Marx, Abigail McKnight, István György Tóth, and Herman G. van de Werfhorst

Print publication date: 2014

Print ISBN-13: 9780199687428

Published to Oxford Scholarship Online: April 2014

DOI: 10.1093/acprof:oso/9780199687428.001.0001

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Rising Inequality in Japan

Rising Inequality in Japan

A Challenge Caused by Population Ageing and Drastic Changes in Employment

Chapter:
(p.393) Chapter 17 Rising Inequality in Japan
Source:
Changing Inequalities and Societal Impacts in Rich Countries
Author(s):

Miki Kohara

Fumio Ohtake

Publisher:
Oxford University Press
DOI:10.1093/acprof:oso/9780199687428.003.0017

Japanese income inequality started to increase gradually in the 1980s, increased significantly during the late 1990s, and more slowly since. The increase in the late 1990s was accompanied by a smaller share of income for low-income groups. Poverty rose especially among people aged 20–39 years and children up to ten years, while it declined among the elderly. The first main factor for this widening gap is population ageing: an increasing share for older people who generally have higher inequality and lower incomes. Another factor is drastic changes in employment. In response to the long-lasted economic recessions since the late 1990s, many Japanese firms avoided recruiting full-time employees and instead hired part-time, contract, and dispatched workers, because of the sizable cost of employment adjustments. Since non-standard employees’ average earnings are lower than those of full-time employees, increasing non-standard employment and labour market segmentation have caused the income dispersion to widen.

Keywords:   income inequality, drivers of inequality, ageing, Japan, hiring, non-standard employment, poverty, child poverty, low-income groups

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