nep-tid New Economics Papers
on Technology and Industrial Dynamics
Issue of 2012‒04‒10
two papers chosen by
Rui Baptista
Technical University of Lisbon

  1. Does E-commerce Increase Employment in Japan? An empirical analysis based on the Establishment and Enterprise Census (Japanese) By KWON Hyeog Ug
  2. Changes in the Size Distribution of Manufacturing Establishments: Analysis in view of industrial structure and firm dynamics (Japanese) By GOTO Yasuo

  1. By: KWON Hyeog Ug
    Abstract: Using firm-level data from the Establishment and Enterprise Census for 2001 and 2006, we explore the effects of e-commerce on the employment growth rate. In the regression analysis for only the surviving firms between 2001 and 2006, we find that employment grew more rapidly for firms which adopted e-commerce, even when controlling for firm size, age, ownership structure, and industry characteristics. To examine the difference of effects of e-commerce across industries, we divide the whole sample into manufacturing, commerce, and service. We find that e-commerce has a positive influence on employment, irrespective of industries.
    Date: 2012–03
  2. By: GOTO Yasuo
    Abstract: This paper analyzes changes in the weight of small establishments in the overall industrial structure and the factors behind them in view of the size distribution of firms using data on domestic and overseas manufacturing establishments. The international comparison of long time series shows that the proportion of small establishments has generally been in decline in Japan while those of other advanced countries shifted to an upward trend in and around the 1970s. This difference was caused by changes in the industrial composition and a decrease in the proportion of small establishments within respective industries, as confirmed by the decomposition analysis of contributing factors with an eye on changes in the industrial structure. A key factor contributing to the changes in the industrial composition is the decline of industries that tend to have a large proportion of small firms, such as the textile industry. Regarding the decrease in the proportion of small-sized firms across industries, very small firms with four to nine employees have shown a particularly sharp decline. Analyzing this phenomenon by focusing on the dynamics of firm evolution, i.e., the entry, growth, and exit of firms, we find that the number of entries has mostly decreased compared with that of exits over the past few decades. During the same period of time, firm growth—another factor contributing to changes in firm size distribution—has worked to shift the size distribution toward smaller firms, which is contradictory to the findings in preceding studies on other countries. While the changes in industrial composition that have worked to lower the proportion of small establishments in the overall industrial structure can be understood as a response to various changes in the business environment, the low number of new entries is a disturbing factor that may undermine the industrial vitality of Japan. The implementation of government policy for small and medium-sized firms needs to be underpinned firmly by the thorough understanding of factors contributing to changes in the weight of small-sized firms in the overall industrial structure.
    Date: 2012–04

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