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Changes in the Demand for Skilled Labor within Japan's Manufacturing Sector:Effects of Skill-Biased Technological Change and Globalization*1

September 2005
Hitoshi Sasaki*2
Kenichi Sakura*3

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  • *1 We are especially grateful to Izumi Takagawa for her capable assistance. We also thank Kyoji Fukao, Kojiro Sakurai, Eiichi Tomiura, Masahiro Higo, Takeshi Kimura, seminar participants at the Japan Economic Association 2005 Spring meetings, and other officials of the Bank of Japan for their helpful comments and suggestions. Of course, we are solely responsible for any remaining errors in this paper. The views presented in this paper are those of the authors, and not those of the Bank of Japan.
  • *2 Research and Statistics Department
    E-mail: hitoshi.sasaki@boj.or.jp
  • *3 Research and Statistics Department
    E-mail: kenichi.sakura@boj.or.jp

Abstract

This paper examines the demand shift toward workers who are university graduates in terms of skill-biased technological change (SBTC) and globalization, both of which utilize relatively more workers with specific skills. According to the results of our empirical study, which used the major groups of Japan's manufacturing panel data from the 1988-2003, it is clear that the increase in the relative demand for university graduates is closely related to the R&D expenditures ratio (SBTC) and the import ratio from the East Asian countries or the foreign production ratio (globalization). This suggests that there has been a demand shift toward highly educated workers in Japan's manufacturing sector due to both SBTC and globalization.

Keywords:
skilled workers; skill-biased technological change; globalization

JEL Classification Number:
F16; J23; O30