The Diverging Political Pathways of Labor Market Reform in Japan and Korea

By Song, Jiyeoun | Journal of East Asian Studies, May-August 2012 | Go to article overview

The Diverging Political Pathways of Labor Market Reform in Japan and Korea


Song, Jiyeoun, Journal of East Asian Studies


In this article, I analyze diverging political pathways of labor market reform with an empirical focus on the cases of Japan and Korea. Despite similar trends of regulatory reform toward the increase of labor market flexibility, the patterns of labor market reform differed in the two countries. Japan adopted labor market liberalization for nonregular workers with the persistence of employment protection for regular workers. In contrast, Korea opted for regulatory reform for all workers while simultaneously strengthening workers' basic rights and improving protections for nonregular workers. I argue that the institutional features of the employment protection system determine the diverging patterns of labor market reform in Japan and Korea.

KEYWORDS: labor market reform, institutional features of the employment protection system, Japan, Korea

**********

UNDER INTENSIFIED GLOBAL MARKET COMPETITIONI ADVANCED INDUSTRIALIZED countries as well as developing ones have liberalized restrictive rules and regulations governing employment contracts and working conditions over the past few decades, embracing the principles of labor market flexibility (Imai 2006; Iversen 2005; Kim and Lim 2000; Miura 2002; Murillo and Schrank 2005; Park 2000; Wood 2001). By the early 1990s, policy debates over the transformation of rigid labor market institutions into more flexible ones dominated East Asian countries, especially Japan and South Korea (hereafter, Korea), where state-led developmental models had begun to stumble. A protracted recession after the bursting of the asset bubble pushed Japan to promote a series of labor market reforms in order to revive its sluggish economy. Similarly, the 1987 political democratization and the Asian financial crisis cast doubt on the viability of Korea's old labor model, in which repressive labor control combined with wage restraints undergirded state-led development. Japan and Korea responded to these political and economic challenges by taking important steps to reform the labor market, but they did so in very different ways.

In Japan, the conservative Liberal Democratic Party (LDP) government liberalized the labor market for nonregular workers (e.g., part-time, temporary, and fixed-term contract workers), but it rarely challenged the key principle of employment protection for regular workers (e.g., full-time permanent workers in large firms). By contrast, in Korea, the two center-left governments ruled by prolabor presidents prioritized the weakening of employment protection for regular workers while strengthening workers' basic rights and improving protections for nonregular workers. Korea's labor market reform, however, provoked intense political conflicts between chaebol (family-owned and family-managed large business conglomerates) employers, chaebol unions and workers, and policymakers in the processes of policymaking and implementation.

Why did the two countries respond differently to the common pressure for labor market reform? Why did a center-right government allow the opportunity of the economic crisis go to waste, retaining extensive employment protection for regular workers, whereas a center-left government promoted labor market liberalization across the board? I argue in this article that the institutional features of the employment protection system explain the diverging patterns of labor market reform in Japan and Korea. In Japan, the characteristics of the employment protection system, in which institutional arrangements had centered on implicit and explicit political exchange among employers, regular workers, and policymakers and had been entrenched in social and economic transactions, prevented employers and policymakers from proposing labor market reform for regular workers even in times of economic downturn. Instead, they opted to transfer the costs of labor adjustments to nonregular workers (mostly female, young, and elderly workers) excluded from the coverage of the political exchange. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

The Diverging Political Pathways of Labor Market Reform in Japan and Korea
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.